# EUR-Lex - 52014DC0545 - EN

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# 52014DC0545

**COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Guidelines for the analysis of the balance between fishing capacity and fishing opportunities according to Art 22 of Regulation (EU) No 1380/2013 of the European Parliament and the Council on the Common Fisheries Policy /* COM/2014/0545 final */**

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COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN
PARLIAMENT AND THE COUNCIL

Guidelines
for the analysis of the balance between fishing capacity and fishing
opportunities according to Art 22 of Regulation (EU) No 1380/2013 of the
European Parliament and the Council on the Common Fisheries Policy [1].

1. Introduction

The existence of fleets which are not in balance
with the resource they exploit has been an important driving force behind the
historic overexploitation of resources in European waters. The new Common
Fisheries Policy confirms the need for measures to manage fishing capacity:
Member States are required to put in place measures to adjust the fishing
capacity of their fleets to their fishing opportunities over time. The analysis
and evaluation of the balance between the fleets and the resources that they
exploit is carried out by each Member State, in accordance with the present
common guidelines developed by the Commission[2]. These
guidelines should also be used for the purpose of the Commission's annual
report to the Council and Parliament on the balance between the fishing
capacity of member States' fleets and their fishing opportunities[3].

The common guidelines developed by the Commission
will also play an important role from 2014 onwards by establishing a direct
link between each Member State's fleet report and fleet measures under the new
European Maritime and Fisheries Fund (EMFF)[4], which will
continue to make available public support for the permanent cessation of
fishing vessels in the 2014-2020 period[5].
A specific ex-ante conditionality related to the fleet report has been
established, which may have a direct impact on the achievement of the specific
objectives of the new EMFF[6].
Under the rules of the EMFF, support for permanent cessation is limited and
targeted to cases where a fleet segment is not effectively balanced with
fishing opportunities available to that segment[7].

The new fleet report guidelines contained in this
document set out a common approach for the estimation of the balance over time
between fishing capacity and fishing opportunities. Account needs to be taken
of the available fishing opportunities as well as of the impact of the fleets
upon them. To this end, it is recommended to assess, for each fleet segment,
the extent to which each fleet relies on stocks that are fished above the
target rates, and to assess how many stocks that make up a significant part of
their catches are at biological risk due to low abundance and are significantly
affected by the fleet. This will allow an assessment of the imbalance between
each fleet segment and the stocks they rely on. Inferences of imbalance may
also be drawn from other parameters. For instance, unprofitable or underused
fleet segments  may indicate that the fleet segment is not in balance with the
resources. Where many vessels in a fishing fleet segment are recurrently or
permanently tied up and inactive, or where many vessels spend less time fishing
than they could, then the fleet segment in question may be too large for the
available resources on which the vessels rely, particularly if economic
performance is poor.

2. Purpose and Principles

The purpose of these guidelines is to provide a
common methodology for the assessment of the
balance over time between fleet capacity and fishing opportunities at fleet
segment level.

These guidelines aim to:

use
standard methods to ensure a level playing field when different fleet segments
are being compared;

follow
best possible scientific, economic and technical practices[8],
and ensure compatibility with standard biological, economic and social
assessments;

use
data collected according to the Data Collection Framework to facilitate
comparisons and to avoid duplication of work.

The fleet segment assessment should be a synthesis
assessment based on the foregoing components. A standard methodology for
reaching an overall assessment for each fleet segment is described below.

3. Measuring the parameters

Member States are invited to calculate a small
number of biological, economic and technical parameters each year and compare
the results against standard values. In order to keep the workload manageable
and to have standardised analyses, these parameters should be calculated using
data collected under the Data Collection Framework[9].

The biological indicators are designed to reflect
the extent to which the size of each fleet segment is not in balance with the
stocks that they exploit. Where possible and available, these indicators will
identify where imbalances lie.

Short- and long-term profitability indicators should
also be calculated, as should be indicators of vessel utilisation. These
indicators provide information about the economic and operational state of a
fishing fleet segment, which can be informative in the analysis of the balance,
but also for other operational decisions to be made at Member State level.

4. Assessing the balance

The indicators are intended to be used in
combination to draw conclusions on imbalance for each fleet segment separately.
Aggregated analyses across many different fisheries in one Member State are not useful.

In general, fleet segments that are relying on
healthy stocks and are also profitable both in the short- and long- term are
likely to be in balance.

Fleet segments that are not in balance with the
fishing opportunities they are exploiting would normally be considered as being
in imbalance, even if economic indicators show short and long term
profitability. The CFP refers to balance (and imbalance) over time, so
it is appropriate to consider several years rather than a single year.

As the lack of complete stock assessments for a
significant number of stocks prevented the calculation of biological
indicators, alternative indicators might need to be selected or developed. When
the biological indicator is unavailable due to the lack of values of F and Fmsy
for more than 60% of the stocks that constitute the catch, the sustainable
harvest indicator cannot be used meaningfully to assess the balance or
imbalance of a fleet segment. In such cases Member States should, in order to
help assess imbalance, use available assessment information about one or more
species that for reasons of historical abundance or consistency could be
considered as indicators of the impact of fishing on an exploited ecosystem.

Fleet segments with poor economic performance which
are fishing healthy stocks may face low profitability related to other factors
(e.g. low sales price of the fish, high production costs, consumer preferences,
low demand, increase in fuel prices, high imports or substitution effects),
which are not necessarily related to an imbalance between capacity and
available resources. National authorities will need to follow closely fleet
segments in that situation to avoid that it leads to negative impacts on stocks
in the medium to long term.

In the absence of clear biological
and economic indicators, if the vessel use indicators are  outside their
thresholds, this could indicate an imbalance situation as well.

In each case, the analysis of the
situation should be made against standardised parameters in order to draw
conclusions with a common basis. Appropriate values are indicated in Section 7.
Where the indicators suggest a situation of imbalance, but a Member State considers that nevetheless the fleet segment in question is in balance with
resources (or vice versa), the Commission will expect a supporting
analysis to be provided.

5. Progressive
Implementation

The overall objective should be that Member States
achieve a stable and enduring balance between the fishing capacity of their
fleets and the fishing opportunties over time. While fishing opportunites do
not necessarily match the MSY objective at all times, the first biological
indicator has been designed with this overall objective this in mind.

Where a gradual transition to the MSY objective is
underway, annual fishing opportunities in the transition to MSY may exceed what
would arise from an immediate application of the MSY target. In such situations
biological indicators are likely to exceed the threshold values related to MSY.
It would however not be appropriate to conclude that a fleet segment is
necessarily in imbalance if the transition is underway to align fishing
opportunities with the MSY objective as set out in the CFP. Circumstances like
this should be explained by Member States in their annual reports.

6. Action Plan

For the fleet segments with clearly demonstrated
imbalance, the Member State concerned shall prepare and include in the report
on the balance between fishing capacity and fishing opportunities an action
plan that sets out the adjustment targets and tools to achieve a balance and a
clear time-frame for its implementation. The plan should specify the causes of
the imbalance and in particular if it has a biological, economic or technical
background as calculated according to section 7.

7. Indicators

7.1
Biological Indicators

Two indicators are used to assess whether vessels
are relying on overfished stocks, or involved in causing a high biological risk
to a depleted stock. The description of the indicators and calculation methods
are given in Section 10.

The sustainable harvest indicator is a measure of
how much a fleet segment relies on stocks that are overfished. Here,
“overfished” is assessed with reference to Fmsy values over time,
and reliance is calculated in economic terms. Where Fmsy is defined
as a range, exceeding the upper end of the range is interpreted as
"overfishing".

Threshold: Values of the indicator above 1 indicate
that a fleet segment is, on average, relying for its income on fishing opportunities
which are structurally set above levels corresponding to exploitation at levels
corresponding to MSY. This could be an indication of imbalance if it has
occurred for three consecutive years. Shorter time period should be considered
in the case of small pelagic species.

The stocks-at-risk indicator is a measure of how
many stocks are being affected by the activities of the fleet segment that are
biologically vulnerable – in other words, stocks which are at low levels and
are at risk of not being able to replenish themselves and which are either
important in the catches of the fleet segment or where the fleet segment is
important in the overall effects of fishing on the stock. If a fleet segment
has an impact on one or more stocks at high biological risk, this is an
indicator of a potential capacity imbalance.

Threshold: if a fleet segment takes more than 10% of
its catches taken from a stock which is at risk, this could be treated as an
indication of imbalance.

7.2
Economic Indicators

Two indicators are used to evaluate whether fleet
segments are economically sustainable in the long
term (allowing capital investments) and to be able to cover their costs in the
short term. The technical basis for calculating
these indicators is given in section 11.

The first indicator (Return on Investment) compares
the long-term profitability of the fishing fleet segment to other available
investments. If this value is smaller than the low-risk long term interest
rates available elsewhere, then this suggests that the fleet segment may be
overcapitalised.

Threshold: If the return on investment (RoI) [10]
is less than zero and less than the best available long-term risk-free interest
rate, this is an indication of long-term economic inefficiency that could
indicate the existence of an imbalance.

The second indicator is the ratio between current
revenue and break-even revenue. This measures the economic capability of the
fleet segment to keep fishing on a day-by-day basis: does income cover the pay
for the crew and the fuel and running costs for the vessel? If not, there may
be an imbalance.

Threshold: If the ratio between current revenue and
break-even revenue is less than one, this is an indication of short-term
economic inefficiency that could indicate the existence of an imbalance.

7.3
Vessel Use Indicators

These
indicators describe how intensively the ships in a fleet segment are being
utilized. The calculation of these indicators is
described in Section 12.

The
first indicator describes the proportion of
vessels that are not actually active at all (i.e. that did not fish at
any time in the year).

The
second indicator concerns the average activity levels of vessels that did fish
least once in the year, taking account of the seasonality of the fishery and
other restrictions. Under normal conditions, it can be expected that 10% or
less of the vessels in a fleet segment should be inactive, which could be due
to major repairs, refits, conversions or pending sales and transfers.

Threshold:
if more than 20% of the fleet segment is recurrently inactive or if the average
activity level of vessels in a fleet segment is recurrrently less than 70% of
the potential, workable activity of comparable vessels, this could indicate
technical inefficiency, that may reveal the exixtence of an
imbalance, unless it can be explained by other reasons, such as unexpected
climatic or man-made events or emergency measures as foreseen in the CFP.

8. Working Method and Use of Data

In order to avoid duplication of work and in order
to keep consistency with other economic and biological data, the evaluations
set out here should be calculated from data as collected and structured under
the Data Collection Framework in force. Naturally every effort should be made
to ensure the completeness of the DCF data, in compliance with Member States’
obligations under the CFP.

It is essential to evaluate the indicators
separately by fleet segment because the various fleet segments of each Member State can have very different characteristics.

As biolological and economic parameters vary over
time, it is recommended that Member States should calculate and consider
time-series of at least three years when considering the balance.

It is possible that consistency problems remain,
particularly for the economic data and indicators. If fleet segments show
erratic economic performance, Member States are expected to check and if so
indicate whether income or costs have been affected by sudden, short-term
shocks.

9. Additional information to be included in national fishing fleet
reports.

The
national fishing fleet reports should also contain the following information:

(a) a description of the
fishing fleet segments in relation to fisheries: development(s) during the
previous year, including fisheries covered by multiannual management or
recovery plans;

(b) the impact on fishing
capacity of fishing effort reduction schemes adopted under multiannual
management or recovery plans or, if appropriate, under national schemes;

(c) information on the
compliance with the entry/exit scheme;

(d) a summary report on the
weaknesses and strengths of the fleet management system together with a plan
for improvements and information on the general level of compliance with fleet
policy instruments;

(e) any information on changes of the administrative procedures
relevant to the management of the fleet.

It is acceptable to address these points by
reference to other documents so long as they are publicly available.

(f)
for fleet segments where imbalance has been demonstrated, an action plan must
be included which sets out the adjustment targets and tools to achieve the
balance, with a clear time frame for the implementation of the plan.

10. Biological Sustainability Indicators

10.1
Sustainable Harvest Indicator

This indicator reflects the extent to which a fleet
segment is dependent on overfished stocks. Here, “overfished” means that a
stock is fished above Fmsy, the fishing mortality rate corresponding
to maximum sustainable yield.

Data requirements are: full biological assements of
the stocks fished,  i.e. where current fishing mortality has been determined;
estimates of Fmsy, or existing proxies to it (Fmax or F0.1)
and the value of the catch of each stock taken.

Where a fleet segment fishes a single stock, the
indicator is calculated simply as

where F is the most recent value of fishing
mortality available from scientific assessments (e.g. ICES and STECF advice).
This parameter is closely similar to the previous indicator F/Ft, the
difference being that Fmsy is now used as the standard objective
across all the Common Fisheries Policy.

The indicator has been extended to cover fleets
active in different fisheries (during the year) and  mixed-fisheries
situations. Where a fleet segment catches fish of a number of species (n) then
the indicator is an average of the indicator above for each stock (i), weighted
by the value of the landings Vi of that stock ([11]).
The indicator is therefore

This indicator performs in the same way whether the
fleet segment makes catches from different stocks in the same fishing
operations or whether this occurs in sequence of different targeted fisheries
within the same fishing year.

As the calculation of this indicator requires some
preparation and database calculations, the Commission is arranging for these
values to be provided to Member States, based on DCF data and assessments by
ICES and STECF.

Calculation of the indicator depends on the
availability of quantified scientific advice for the stocks in question[12].

Calculation of biological indicators based on catch
per unit effort (cpue) or biomass indices is not generally recommended as these
are most often uninformative.

10.2
Stocks-at-risk indicator

The stock-at-risk indicator described in Section 7.1
does not identify cases where stocks at high levels of biological risk are
being exploited.

As a complementary indicator to identify such
situations, Member States are requested to count the number of stocks currently
assessed as being at high biological risk that are exploited by the fleet in
question. In this context, “exploited by” means that the stock(s) at high risk
each make up more than 10% of the catches of the fleet, or that the fleet takes
more than 10% of the catches of the stock.

For this calculation, a stock at high biological
risk means a stock which is either:

a) assessed
as being below the Blim biological level; or,

b) subject
to an advice to close the fishery, to prohibit directed fisheries, to reduce
the fishery to the lowest possible level, or similar advice from an
international advisory body, even where such advice is given on a data-limited
basis; or;

c) subject
to a fishing opportunities regulation which stipluates that the fish should be
returned to the sea unharmed or that landings are prohibited; or

d) a
stock which is on the IUCN "red list"or is listed by CITES.

This can be expressed, for each fleet segment
catching n stocks of fish, as:

where

Ci= catch, Ct = total catch of all stocks taken by
the fleet segment, Ti = total catch of stock i taken by all segments, for n
stocks that fall into any one of categories a)  to c) above.

11. Economic indicators

The economic indicators may show the extent of
economic over or under capitalisation in a fleet, both in the short and in the
long term.

Two indicators have to be calculated: Return on
investment compared to the potential return that would be received from
investing the capital asset value elsewhere (long term viability) and the ratio
between current revenue and break even revenue (short term viability).

Both
indicators require the use of the interest rate in each MS of a low risk long
term investment for comparison purposes. The Commission proposes to use the
harmonised long-term interest rates for convergence assessment calculated by
the European Central Bank, available at http://www.ecb.int/stats/money/long/html/index.en.html.

To take into account the  high variability in
interest rates in the last few years in most MS due to the economic crisis, the
Commission proposes to use the arithmetic average interest rate for the
previous 5 years. Hence for the purposes of the 2013 assessment of balance, the
interest rate to be used will be that correponding to the period 2008-2012.

In 2013 the Commission is requesting STECF to make
these parameters available to Member States based on DCF information.

As for the other indicators, these parameters should
be calculated on a fleet segment basis.

11.1 Return on Investment (ROI) vs
next best alternative

The return on investment (ROI) for a fleet is the
net profit (profit after capital stock depreciation) of the fleet divided by
total capital asset value of the fleet. The commercial value of any fishing
rights held is not included. All data for the ROI calculation should be available
under the DCF. Data on direct income subsidies should be excluded from the
calculation. However, MS are invited to provide a table showing the subsidies
granted to each fleet segment since 2008.

The suggested calculation method is as follows:

ROI  =  Net profit  / Capital asset value

Where:

Net profit = (Income from landings + other income) –
(crew costs + unpaid labour + energy costs + repair and maintenance costs +
other variable costs + non variable costs + depreciation)

And where:

Capital asset value  =  Vessel replacement value +
estimated value of fishing rights

Ideally, the capital asset value should consist of
both fixed tangible assets (vessel, gear and electronics etc) and intangible
assets (estimated value of fishing rights such as quota, licence etc). When
calculating the fleet capital asset value, MS are asked to consider using the
Perpetual Inventory Method (PIM) and take into account recent advice from the
PGECON[13]
working group on best practices for calculating fleet depreciated replacement
values.

In instances where data on intangible assets are not
available, the Return on Fixed Tangible Assets (ROFTA) should be calculated
instead, using exactly the same calculation method but without including an
estimated value for fishing rights.

The ROI (or ROFTA) as calculated represents the
profitabily per unit (in percentage)  of capital invested in the fisheries
sector.

ROI (or ROFTA) would then be compared to the
interest rate of a low risk long term investment calculated as proposed above.
That interest rate respresents the profitability that the same invested capital
will obtain if it was invested in the next best available alternative (normally
long term government bonds).

The resulting formula for the indicator would be ROI
–  low risk long term interest rate.

If the capital asset value is not available or is
missing for some years or is not reliable for any reason, MS could use net
profit in percentage to do the above comparison. In any event, MS would need to
state which indicator they have used for what period and fleet segment.

11.2 Application and interpretation

Values of  ROI positive and greater than the  low
risk long term interest rate would result in a positive value of the indicator
suggesting that extraordinary profits are being generated, a sign of economic
under-capitalisation. Values of ROI positive but smaller than the low risk
interest rate would yield negative values for the indicator indicating that in
the long term it would more beneficial to invest elsewhere which is a sign that
probably the fleet is overcapitalised and therefore economically inefficient.
Negative ROIs can by themselves indicate economic over-capitalisation.

Calculation example (assuming a low
risk long term interest rate of 5%)

Values for calendar year (€000) || Fleet segment 1 || Fleet segment 2 || Fleet segment 3

Income from landings + other income             || 1500 || 700 || 1000

Crew costs + unpaid labour costs + fuel costs + repair & maintenance costs + other variable costs + non variable costs || 800 || 481 || 850

Capital costs (depreciation + interest payments || 400 || 200 || 200

Net profit || 300 || 39 || -50

Fleet capital asset value (vessel replacement value + estimated value of fishing rights) || 2000 || 1500 || 1500

ROI = Net profit / capital asset value || 15% || 2.6% || -2.5%

ROI – risk free long term interest rate || +10% || -2.4% || -7.5%

11.3
Ratio between current revenue and break-even revenue

The break even revenue (BER) is the
revenue required to cover both fixed and variable costs so that no losses are
incurred and no profits are generated. The current revenue (CR) is the total
operating income of the fleet segment, which consists of income from landings
and non fishing income. All data for this calculation should be available under
the Member States DCF national programmes except for opportunity costs. Data on
direct income subsidies should be excluded from the calculation. In addition,
income and expenditure from the lease of fishing rights, if available, should
be included in the calculation. The inclusion of such data should be mentioned.

The formula for calculating the BER
is as follows:

BER 
=  (Fixed Costs) / (1- [Variable costs / Current Revenue])

Where:

Variable
costs =

Crew
costs + Unpaid labour + Energy costs + Repair and Maintenance costs + other
variable costs

And where:

Fixed
costs = Non variable costs + depreciation

And
current income = income from landings + other income

The ratio is calculated by
dividing the current revenue by the BER i.e.

Ratio     =    Current
Revenue (CR) / BER

The calculation of the ratio as
indicated above gives a short terrm view of financial viability. Should data
permit, MS could also opt for providing an economic long term viability
analysis of CR/BER. Doing so would require adding opportunity costs to fixed
costs:

Fixed costs = Non
variable costs + depreciation+ opportunity cost of capital

Opportunity
cost of capital = capital asset value * low risk long term interest rate.

MS will need to state which CR/BER
concept they are using.

11.4 Application and interpretation

The ratio between a fleets current
revenue and break-even revenue shows how close the current revenue of a fleet
is to the revenue required for the fleet to break even in the short term. If
the ratio is greater than 1, then enough income is generated to cover variable,
fixed and capital costs, indicating that the segment is profitable, with
potential under-capitalisation. Conversely, if the ratio is less than 1,
insufficient income is generated to cover variable, fixed and capital costs,
indicating that the segment is unprofitable, with potential over-capitalisation.
If the CR/BER result is negative, this means that variable costs alone exceed
current revenue, indicating that the more revenue is genertated, the greater
the losses will be.

If depreciation and the opportunity
cost of capital parameters are omitted from the calculation, the ratio only
gives an indication of how much income is required to cover operating costs
only in the short term without looking at whether there are extraordinary
profits. The inclusion of these concepts will add a long term view about
expectations of future viability of the fleet but to some extent will overlap
with use of the ROI (or ROFTA) as a long term indicator.

Calculation example:
Ratio of Current revenue to Break-even revenue (CR/BER)

|| Values for a calendar year (€’000) Use Segement total figures || Fleet segment 1 || Fleet segment 2

1 || Current revenue (CR) = Income from landings + other income || 113 000 || 115 000

2 || Fixed costs = Non variable costs + depreciation + opportunity cost of capital || 24 000 || 28 000

3 || Variable costs = Crew costs + Unpaid labour costs + Energy costs + Repair & maintenance costs + Other variable costs || 90 000 || 85 000

4 || BER = 2 / ( 1 - [ 3 / 1 ] ) || 117 913 || 107 333

5 || CR / BER = 1 / 4 || 0.96 || 1.07

12. Vessel use Indicators

12.1
The Inactive Fleet Indicator

Inactive
vessels constitute an unused capacity and as such they reduce the overall
technical efficiency and capacity utilisation rate of the total fleet. The
indicator is calculated on the basis of DCF segment vessel  length-classes
rather then vessel segments as information on gear and target fishery is not
available. A table showing the proportion of
inactive vessels of the total fleet should be provided with respect to number
of vessels, GT and kW.

12.2
The Vessel utilisation Indicator

The
vessel utilisation indicator is the average, for each fleet segment, of the
ratio of the effort actually deployed to the maximum effort that could be
exerted by the fleet. This indicator is based on what are expected to be
reliable data and provides a quickly-calculated assessment of fleet utilisation
in prevailing circumstances for the fishing activity. There are two versions of
this indicator, based on either observed or theoretical maximum activity
levels. Member States should make a choice as to which is the more appropriate,
and report only that indicator to the Commission.

The indicator based on observed maximum activity is
calculated as:

The
ratio between the average effort per vessel in a fleet segment and the observed
maximum effort actually expended by a vessel in the segment (in kWdays or
GT-days) in the reference year.

This indicator can also be
calculated in term of fishing days, as:

The
ratio between average days at sea per vessel and the maximum days at sea
observed in a fleet segment.

The other version of the technical
indicator is applicable in cases where the observed maximum number of days at
sea within a fleet segment for each reference year could have been limited by
external factors. There could be economic (e.g., the fuel crisis), environmental
(e.g. exceptional weather) and social (e.g., not fishing on weekends) reasons
that affect the maximum observed number of days at sea per vessel for certain
years, so that this number may not reflect the true technical capacity of the
fleet.

In such cases, MS may also
calculate the ratio based on the theoretical maximum number of days at sea. 
For this calculation, the “observed maximum effort actually expended by a
vessel in the segment” in the previous calculations is replaced with a
theoretical maximum number of days at sea that could be fished if there were no
external constraints (e.g. if no effort regime was applied). This value would
be assumed to be 220 days as a default value if no data are available, but
otherwise should be estimated according to  natural, technical and social
conditions).  This value should be determined by each Member State using an expert judgement and available information.

The chosen  indicator should be
presented and assessed for a period of several years in order to show whether
the ratios are stable over time.

The calculation could be done
either in kW-days or GT-days as appropriate to the fleet; e.g. preferring kW
for towed gear as as that vessels with larger engines tend to catch more than
those with smaller engines and  GT-days for passive gears,

12.3 Application and
interpretation

Data (days at sea per vessel, GT
and KW) are available at Member State level from data collection according to
the requirements of the DCR and DCF. However, the maximum number of days at sea
is an additional calculation that is currently external to the basic DCF, but a
data call will be issued annually concerning this parameter.

All active vessels in the fleet
should be taken into account when calculating this indicator.  An active vessel
is one which was licensed to fish at some stage during the reference year and
which recorded at least one day at sea during the reference year.  An inactive
vessel is one which may or may not be licensed to fish during the reference
year, but which has recorded no time at sea and no landings during the
reference year.

These indicators shows by how much
fleet capacity could be reduced without reducing overall fleet output
(landings). The technical indicator can therefore be considered the baseline
indicator for each fleet segment.

The margin between the calculated
value and 1 indicates the technical under utilisation of the vessels.  For the
"traffic light system", an indicator of more than 0.9 (i.e. where
average activity is more than 90% of maximum activity) will only be observed in
fleet segments showing a largely homogeneous level of activity, which could be
classed as a green light in practice. Values (depending on fleet homogeneity),
below 0.7 could be considered as showing substantial under-utilisation which
may indicate technical overcapacity (red light).

If a theoretical maximum number of
days is used instead of the observed maximum number of days, significant
differences may appear between the values of the technical indicator calculated
and care should be taken to explain implications.

Calculation example:
Ratio between actual per vessel effort deployed and maximum effort (observed
and theoretical) for a group of three vessels.

Vessel || Capacity 1) || Current effort 2) || Maximum effort (based in observed max.) 3) || Theoretical max effort 4) || Technical indicator (obs.) 5) || Technical indicator (theor.)6)

kW || days || kW days || days || kW days || days || kW days

Vessel 1 || 100 || 80 || 8 000 || 150 || 15 000 || 220 || 22 000 || 0.53 || 0.36

Vessel 2 || 200 || 110 || 22 000 || 150 || 30 000 || 220 || 44 000 || 0.73 || 0.50

Vessel 3 || 400 || 150 || 60 000 || 150 || 60 000 || 220 || 88 000 || 1.00 || 0.68

|| || || Total 90 000 || || Total 105 000 || || Total 154 000 || Average 0.86 || Average 0.58

1) The capacity should be indicated
in kW for all segments; where possible, and in particular for passive gear
segments it is recommended to use also GT.

2) This column presents the
individual vessel activity and effort data.

3) This column contains the maximum
utilisation observed (150 days) for every vessel of the fleet.

4) This column contains the theoretical
maximum utilisation (220 days) for every vessel of the fleet.

5) This column shows the calculated
technical indictor on the basis of the observed maximum utilisation rate
(kWdays in column 2 divided by kWdays in colums 3, then average for the
segment)

6) This column shows the calculated
technical indictor on the basis of the theoretical maximum utilisation rate
(kWdays in column 2 divided by kWdays in colums 4, then average for the
segment)

Each Member State should make a choice
as to which of the technical indicators to present, as described in Section
7.3. The choice has to be explained.

[1] Regulation (EU) No 1380/2013 of
the European Parliament and of the Council  of 11 December 2013 on the Common
Fisheries Policy, amending Council Regulations (EC) No 1954/2003 and (EC) No
1224/2009 and repealing Council Regulations (EC) No 2371/2002 and (EC) No
639/2004 and Council Decision/585/EC, OJ L 354/22 of 28.12.2013.

[2] Article
22 (2) of Regulation (EU) No 1380/2013.

[3] Article 22 (4), second
subparagraph of Regulation (EU) No 1380/2013.

[4] Regulation (EU) No 508/2014 of Parliament of the European Parliament
and of the Council of 15 May 2014 on the European Maritime and Fisheries Fund
and repealing Council Regulations (EC) No 2328/2003, (EC) No 861/2006, (EC) No
1198/2006 and (EC) No 791/2007 and Regulation (EU) No 1255/2011 of the European
Parliament and of the Council, OJ L 149/1 of 20.05.2014.

[5] Public support for
permanent cessation under the EMFF is also limited in time (31 December 2017).

[6] Annex IV to
Regulation (EU) No 508/2014.

[7]Article 34 (1) point
(b) of Regulation (EU) No 508/2014.

[8] These guidelines are
based in on advice from the STECF (SGBRE 10-01, EWG 11-10 and PLEN 10-03), including
comments by four Member States, and taking into account experience in 2013
reported on in STECF EWG 13-28.

[9] See
Council Regulation (EC) No 199/2008 of 25 February 2008, concerning the
establishment of a Community framework for the collection, management and use
of data in the fisheries sector and support for scientific advice regarding the
Common Fisheries Policy, OJ L 60, 5.3.2008.

[10]
Experience shows
that the capital asset value is often not available or is not reliable. Net
profit could replace ROI (or ROFTA) in such cases.

[11] When values are not
available, volumes could be used but MS should indicate whether species are
high or low value.

[12] In cases where more  than 60% of
the value of the catch is made up of stocks for which values of F and Fmsy are
unavailable the indicator is also deemed to be unavailable.

[13]
Planning Group on Economic Issues (PGECON), 16th
– 19th April 2012, Salerno (Italy)