It was a professional and personal challenge to give a talk in regards the “Impact of the EU Yellow cards in the Pacific” at the Pacific Tuna Forum in Fiji this week.

The EU made a game changer with its IUU regulation by denying market access to those products that did not arrived to the border with a “official guarantee” of the flag state of the catching vessel/s attesting on the legality of the catch. Conceptually that is just awesome.

I always recognised and supported that principle, my “beef” with it has been with the practicalities of the Catch Certification Scheme (the tool the regulation uses), the design of the certificate, the fact that is paper based and the backwards (from market to vessel) approach taken less than year after it was 1st introduced (when initially was forwards vessel to market). The fishing industry dynamics and its operational complexities where in existence before the 2010 implementation of the IUU regulation, hence operationally the legislation would have benefited from a much deeper study and understanding of the reality, prior to trying to capture it under a substandard scheme.

My work has been always aimed to make it better from a operational perspective but not to abolish the concept… In fact I’ve dedicated most of the last 5 years of my professional life to help countries to comply with it, by working around many of the operationally frustrating challenges of the scheme while at the same time strengthening the "in country" tools required so the legislation key objective (minimise IUU fishing) is not lost.

Other small countries in the world got yellow cards and some of them reds, like Belize, Togo, Sri Lanka, etc. Notably major countries with weak compliance records got yellow cards as well, like Philippines and Korea, but these were removed a short term later (no that one notice much change in the quality and content of their catch certs). The latest country under this process is Thailand, but interestingly even if they get red carded, the impact in the tuna world would be minimal… because the “ban” in exports to the EU will only affect tuna caught by Thai flagged vessels… and paradoxically there are none. The biggest exporter of can tuna in the does not operate a tuna fleet (welcome to one of the many twists of the fishing world).

In any case, I decided immediately that there was no point of dwelling in the perceived politics of the situation, but more constructively on the advances that this “yellow cards” have catalysed in the Pacific regions in terms of MCS and related control systems, and particularly the in regards the strengthening of the EU Catch Certification Scheme. And I’m happy to say, we got plenty of positives to report.

The 1st step we took was to foster the understanding of what this whole issue was about, because in reality not many people in the region (and the world I may add) really understood what it was about. The training provided by the EU prior of its implementation was minimal and quite poorly structured (one session for the whole pacific in New Caledonia, based on a powerpoint that just copy and pasted the regulation – I still have it! – as a trainer I can assure that is the best way to loose an audience). Followed by the late publication of a “handbook” which provides guidelines and answers on the implementation of the EU IUU Regulation is a lengthy and wordy document and it was written before the implementation of EU IUU Regulation itself, so many scenarios are not contemplated and the substantial changes of interpretation (such as the Weight in the Catch Certificate - WICC notes 1&2), make the document, while well intended, of very limited use.

For me the analogy of the iceberg fits the situation, what we only see is the tip: the certificate (the-unfortunately- piece of paper). But what really matters is what is below… what I called the “fish legality” and the “fish accountancy”, so all this needed to be strengthen and systematized, so the tip is meaningful.

Hence was very important to develop and standardize a training program that dealt with the conceptual issues first and later with the scenarios that the regulation requires to be contemplated, and FFA's DevFish II programme contracted me for that.

The Certificate itself is a complex document with a multi-layered structure of responsibilities that do not always correlate chronologically with reality, hence detailed explanations and a standardization of the way the information is to be presented was required. These also had to be expanded indirectly to foreign flag states that operate in the region as to maintain “a system” that is homogenous trough the operational chain. The “quality” of foreign certificates was a constant source of frustration for many of the officers we worked – how come they send us this shitty documents and they are not yellow carded? Was a frequent question, that I had no answers to provide.

The next element was to train on the content and scenarios presented by the regulations and understand which ones applied to each case in each island country. This was not easy, because besides the difference in the industries in each country it had to consider as well the interactions in between the Catch Certification, the Health Certification (normally under Health Authorities) and Certification of Origin (under Customs)… so not easy task.

Furthermore we had to consider the scenario of the transhipment countries, as this countries are part of the system but not initially contemplated (not “notified” using the EU IUU lingo) but have an important role without getting any direct benefits (other than fees for use of their ports), as this countries are not allowed to trade fish with the EU because they lack of sanitary authorisation. As in the other cases, all this knowledge had to be built from scratch.

Initially we had to understand how to re-structure the traditional view of MCS into a more holistic approach. Fish does not become illegal during processing, is caught illegally. Therefore if we stop it before landing, then a big chunk of the problem is gone… but then we also need to stop the laundering of illegal fish with legal fish. So we introduce the concept of the "Unloading Authorization Code" (UAC) and Fish Accountancy to link with MCS.

The concepts “mixes” two basic elements; the requirements (in one way or another) of Port State Measures Agreement (PSMA) and a Key Data Element needed to follow a landing through the value chain. Under PSMA, vessels have to seek advance approval to enter a port, sufficient to allow adequate time for the port state to examine the information provided. Hence the information required needs to be provided and assessed to facilitate a decision as to whether or not to deny or grant entry. If an “authorization” is given, either the master or the vessel’s representative can present the authorization to the authorities when the vessel arrives in port.
This “authorization” will need to be “coded” (on some form or another) as to be recorded in one way or another as to be able to review and accounted and potentially crosschecked if it is deemed necessary. So why not simply use this Unloading Authorization Code (UAC) as the tool for the initial Key Data Element required for any Catch Documentation Scheme or traceability analysis along the value chain from landing to consumer (or wherever it is needed or most cost effective).

Furthermore, most fishing vessels operators (company own or independent) do maintain a trip or voyage coding systems in order to monitor logistics, fuel consumption, crewing rosters, general costs and more importantly “final payments”(which are in the form of a % of the catch volumes, species composition and values) are to the traced back to that landing, minus the fix costs. Therefore the concept already exists in the sector, so this UAC becomes a better and standardised use of an existing tool.

The "Process" associated to the use design and use of the UAC is as follow:

Arrival notification
The “authorization” to land is assessed by the fisheries authorities in the port in a compliance response to a series of requirements that are decided by the authorities of the Port State in relationship to its own legislation and requirements or those of an RFMO, international agreements, etc. The scope of the requirements can be arranged in accordance to a pre determined risk index based on the characteristics of the vessels requiring port access.

As an example: domestic flagged vessels fishing in the Port State EEZ with local VMS and observers may be at the lowest risk tier (i.e green). Foreign vessels with local licenses, foreign charter vessels, domestic vessels fishing in other EZZ or the High Seas, Fish Carriers, vessels with patchy observer coverage, indirect VMS access, etc. are in middle risk tier (yellow). Finally, foreign flagged vessels with no direct VMS access by the coastal or port state, or no observer coverage or vessels identified as a Vessels of Interest (VoI) by any country or RFMO are singled as high risk vessels (red).

As noted, the risk profile of the vessel defines the required time for arrival notification (12, 24, 48 hrs), plus the amount and depth of the information to be provided by the vessel intending to land. In considering the assessment an UAC can be provided and the vessel is allowed to dock with intention to unload. In instances where it is not provided the vessel may be allowed to dock for humanitarian or force majeure reasons but not to land.

The structure and nature of the UAC is up to the Port State or RFMO to decide, but it is important that it is inclusive in the information it holds, and in principle is to be an integral part of relational database such as a Fisheries Information Management System (FIMS).

The UAC “design” should include for elements such as: country identification, trip and port traceability, fishing effort measurements, observer reporting, etc. and it should have inter-operability with the vessels operators trip/voyaging coding systems, and if needed with the maritime authorities. Interestingly, this inter-operability of the vessels operators and authorities UAC can be beneficial to crews and captains in case of payment disputes or safety at sea issues arising from the maritime authorities.

Inspections
The risk profile and compliance level during the previous step defines the need for inspection of the landing and the expected % of yearly inspections decided by the port state, i.e. 25% of landings for green tier vessels, 50% for yellow and 100% for red.

The decision of whether an inspection should take place needs to be based on the risk profile of the vessel (if red) and the % of inspections that have already taken place (yellow, green) or issues arising from the documentation presented. If an inspection is performed, then the UAC is recorded in the inspection forms in order to provide for future verification if required and for compliance performance monitoring. Ideally the Inspection forms are digitalized on a tablet type device and the data enters the FIM is real time under the specific UAC of that operation. If the results of the inspection shows inconsistencies or non compliances (and based on the extent of these) the landing may be authorized under bond or denied. Then the UAC associated to that landing is “flagged” into the FIMS in order to interrupt any further movements or transactions associated to that landing until the issues are resolved.

Unloading
If it is decided that an inspection is necessary then the results, if compliant, will provide the permission to unload (or transship). This landing could be conditional, as explained before (under bond). If an inspection does not take place the LAC then becomes the “de facto” authorization for unloading.

In the case of transshipments, the UAC is attached to the catch estimates (from logsheets) or real (if hanging scales are used) and reflect the captains/mates receipt or any the document the volumes being transshipped. The UAC will then accompany the transshipping documentation (printed) and if the receiving country has an MoU with the port state or is part of the same RFMO, then they can potentially log-in on to a common FIMS to cross check the legality and estimated volumes of the landing and to add their own information. If landing or transshipments are partial (and this practice should be discouraged by principle) then the UAC would need to be “partitioned” into lots associated to the original UAC with this retained as the main reference and the lots can be incorporated into FIMS. Any volumes not landed should be considered as a “lot” in the same manner as the landed ones.

Reception or weight in
At the coosltore or processing facility reception or anywhere where the official sorting and weight in of the fish is done the UAC “marks” the volumes in the FIMS and into the receiving operator’s inventory system. If the whole fish is loaded into containers for direct export then the weight in is to be recorded under the UAC on the FIMS and the volumes containerized discounted of the total volumes recorded that that landing. That exported lot would still be associated to the UAC as in the case of partial landings or transshipments.

The private operators receiving the fish could either load all the data on a FIMS portal or maintain their own inventory and traceability systems that could either be “absorbed” by FIMS or audited by fisheries authorities. In any case final volumes by species would be incorporated into FIMS for the UAC.Companies normally use lot systems based on the species, size and vessel of origin. All these parameters can be linked to the UAC under FIMS or their own inventory and traceability management system.

Processing establishments and cool stores
Most responsible MCS systems include Mass Balance evaluation (fish landed = fish in storage + fish processed or sold) on the establishments, by the fisheries authorities. These evaluations starts with the UAC of all fish received for a period of time and what is presently in the inventory. The officers for example may chose a minimum of 5 different pallets/boxes/bins to do a full traceability exercise and check that each of those pallets/boxes/bins (raw material as well as processed fish) are registered on company documentation and that can be traced to the UAC.

Volumes withdraw from storage for processing are “discounted” from the original landed volumes in relation to the UAC, hence each withdrawal would leave a smaller volume left from the original until the landing is exhausted. Obviously same principle applies to whole fish withdrawals. Processed product volumes will be inventoried under the same UAC taking in to consideration the processing ratios (conversion factors) associated to that type of products.

Final product Sales and Exports - Catch Certificates
Prior to the product leaving the premises Catch Certificates (domestic or market specific) are prepared based on all the operations relating to the original UAC (or UACs in the case of mixed products). The referencing and traceability to the specific UAC plus the fish volumes accountancy through the value chain becomes the basis and condition “sine qua non” for a catch certificate, either paper or electronic.

That leave us with the “how much” Fish Accountancy knowing this has 2 benefits… we know how much is being caught, which management importance, and then we can record those volumes as the “initial deposit”, and by this we avoid chances of “fish laundering” from any potential illegal landing (just as any financial systems deals with money laundering)

We use the volumes unloaded as the initial deposit from which extractions will be made from, and the different species unloaded become “different currencies” on a same deposit. Then a traceability scheme in the system allow us to follow the “extractions” of different currencies trough time either by whole fish sales or processing. Furthermore, processing losses get dealt by the system like currency exchange (1kg of fish = 400g of loins).

Finally, we “mass balance” each sale/export against that original “deposit” until the volume is exhausted, and no more fish can be attributed to that unload. If some one wants to export fish he “didn’t” land… then we know something is happening there and the inspectors can focus on them.

As you imagine, there is lot of developmental and technical complexity behind these systems… PNG took the lead in developing this concept… even if they don’t have the money that a bank have! Furthermore the system is understandable by proxy to the banking system and “fair”… as there are no “interpretations”… is just about balancing volumes… “fish in” vs. “fish out”

All this took work place at a big cost for the countries and refer only to one of the elements highlighted on the Yellow cards, so a series of other issues (new legislation, IUU NPOAs, VDS allocation, etc) had to be worked as well.

After almost 2 years, we all agree we know much better now what is expected than before and we tried to make the system work in our favour. Even if there are some big issues on pipeline to be worked out... But reality is that for small Islands states, it is always a "catch up" game... They read the rule book while running behind the ball.

I personally think that a lot of the initial "yellow card" issues came up out of personal conflicts in between the parts, at the end of the day the decisions are made by people and justified by paper, and there were a lot of entrenched positions (attacker - attacked, colonial - independent, and so on) being taken initially and this dragged down the process. Things are calmer now and the PICs have responded with actions and not only words. While a lot of the world Tuna is caught in these waters, very little is done under PICs flagged vessels, hence the responsibilities also rely heavily with the DWFN that fish here and not just on the coastal states.

Finally, I always make this point at any presentation, while the EU impose the rules - beyond how good they are - they also fund the assistance to help comply with them.

During the Q&A session, NZ's Ambassador for Pacific Economic Development Shane Jones (and a good man I have been working with for a few months now) shot point blank at me the question in everyones mind:

Did it had a positive impact? PIC go to the WCPFC meetings and promises are done but little is deliver, so do the EU dis us a favour with the yellow cards?

I just smiled, and said something like:

Brooh... I can't answer that question... I'm just a deck-boss helping fellow deck crew. That is a question for the Captain.

From the deck, I can tell you that everyone knows now much better their job than before, and know better their own limitations... but if to get to this you needed a economic powerhouse like the EU with 1/2 a billon inhabitants to "name and shame" minnow coastal states with less than 40 years of independence and VERY limited human and economic resources... well... I just not qualified (or independent enough) to provide you an answer.

Francisco Blaha

Independent Fisheries Adviser

The Impact of the EU yellow cards in the Pacific /September 25, 2015 by Francisco Blaha

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