EUROPEAN COMMISSION Brussels, 3.8.2016 SWD(2016) 272 final COMMISSION STAFF WORKING DOCUMENT



IMPACT ASSESSMENT

Accompanying the document PROPOSAL FOR A REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing a mixed fishery multi-annual plan for demersal stocks and their fisheries in the North Sea {COM(2016) 493 final}

{SWD(2016) 267 final}



This report commits only the Commission's services involved in its preparation and does not prejudge the final form of any decision to be taken by the Commission



TABLE OF CONTENTS 1.Introduction 2.Procedural issues and consultation of interested parties 2.1.Organisation and timing 2.2.Consultation of the Regulatory Scrutiny Board 2.3.Consultation and expertise 2.3.1.Consultation with Stakeholders 2.3.2.Expert advice 2.3.3.Other relevant studies 2.3.4.Internal consultation 3.Problem definition

3.1.Existing legislation and political context 3.1.1.Annual fishing opportunities regulation 3.1.2.The "old" CFP Regulation (EC)2371/2002 and management plans derived from it 3.1.3.The new Basic Regulation 3.1.4.Lisbon Treaty, inter-institutional conflict and its resolution 3.1.5.Technical measures regulations 3.2."Traditional" management of North Sea demersal fisheries: The problem of discarding 3.3.Solutions and problems stemming from current North Sea Management Plans 3.4.CFP-reform: solving problems, creating new challenges 3.4.1.Ending discarding and overfishing 3.4.2.New challenge: "Choke" species and underfishing 3.4.3.New challenge: the costs of landing all catches 3.5.Mismatch between the current management plans and the Basic Regulation 3.6.Solutions foreseen in the CFP Basic Regulation 3.7.Who is affected? 3.8.Summary 3.9.Legal basis for the EU to act 4.Objectives 4.1.General objectives 4.2.Specific objectives

5.Policy options 5.1.Discarded options 5.1.1.No policy change at EU level 5.1.2.Amendment of the existing management plans 5.2.Potential policy options 5.2.1.Use solely the Basic Regulation (including the landing obligation) 5.2.2.A single mixed-fisheries plan for North Sea demersal fisheries 6.Analysis of impacts 6.1.Option 1- Use the Basic Regulation (including the landing obligation) 6.1.1.Environmental effects 6.1.2.Economic effects 6.1.3.Social effects 6.1.4.Administrative costs 6.2.Option 2- A single mixed-fisheries plan for North Sea demersal fisheries 6.2.1.Sub-option 2.1 - FMSY is achieved by the start of 2016 6.2.2.Sub-option 2.2 - FMSY is achieved by 2020 at the latest 6.2.3.Sub-option 2.3 - short (5 year) recovery period 6.2.4.Sub-option 2.4 - long (10 year) recovery period 6.3.Summary 7.Comparing the options

7.1.Assessment against the environmental, economic and social impacts 7.2.Qualitative assessment against the general and specific objectives 7.3.Effectiveness, Efficiency, Coherence and Acceptability 7.4.The preferred option 8.Monitoring and evaluation 8.1.Monitoring 8.2.Ex-ante evaluation of delegated acts (regionalised measures) 8.3.Ex-post evaluation of the plan Glossary Biomass Blim BMSY Days at sea Allowed maximum time for fishing trips allocated to vessels per year, depending on their type of fishing gear. For the purpose of this impact assessment it means the same as 'fishing effort' which is the product of the capacity and the activity of a fishing vessel. Demersal Discard plan Discards Unwanted catches returned to the sea during fishing operations. Fishing mortality (F) The rate at which fish are removed from the stock due to fishing operations. FMSY A biological reference point. It is the fishing mortality rate that, if applied constantly, would result in an average catch corresponding to the Maximum Sustainable Yield (MSY) and an average biomass corresponding to BMSY. Harvest control rule Landing obligation Discarding is the practice of returning unwanted catches to the sea, either dead or alive, Maximum Sustainable Yield (MSY) In population ecology and economics, MSY is the largest average yield (catch) that can theoretically be taken from a species’ stock over an indefinite period under constant environmental conditions. Mixed fisheries Fisheries in which several species are likely to be caught in the same fishing operation. Overexploitation A situation where catches of fish observed fishing mortality (or exploitation) rates exceed targets. Pelagic In relation to fish, the term 'pelagic' refers to fish which live in the upper layers of the water column, e.g. herring, sprat and mackerel. Precautionary approach to fisheries management An approach to managing fisheries to ensure a high probability of avoiding undesirable outcomes. Typically this involves specifying a limit value of spawning stock biomass, then managing fisheries to make sure the stock stays above this level. A limit reference point may also be specified for fishing mortality, in which case management will aim to keep fishing mortality below this level. Recruitment The number of new fish added to the exploitable portion of the stock resulting from growth of juvenile fish into adults, or migration of smaller fish. Regionalisation The process by which the Member States with direct interest for fisheries of a given geographical region organize themselves with the aim to agree on common management measures. The agreed measures as joined recommendation are submitted to the Commission and after scientific assessment adopted as Commission delegated acts. Spawning Stock Biomass The weight (usually in tonnes) of the total number of individual fish that is old enough to reproduce. This generally corresponds to the minimum landing size and so defines the 'fishable' population. Stock The population of a given species that forms a reproductive unit and spawns little if at all with other units. The “total stock” refers to both juveniles and adults while “spawning stock” refers to the adult population (see above). TAC Total allowable catch; the maximum biomass of fish that can be caught from a given stock in a given year. Technical measures Measure establishing conditions for the use and structure of fishing gear and restrictions on access to fishing areas.



List of acronyms AC Advisory Council CFP Common Fisheries Policy EWG Expert Working Group FTE Full-Time Equivalent GVA Gross Value Added IA Impact Assessment ICES International Council for the Exploration of the Sea MAP Multi-annual Plan MRAG Marine Resources Assessment Group MSFD Marine Strategy Framework Directive MSY Maximum Sustainable Yield NGO Nongovernmental Organization NSAC North Sea Advisory Council SME Small and Medium-Sized Enterprise STECF Scientific, Technical and Economic Committee for Fisheries TFEU Treaty on the Functioning of the European Union



Lead DG: DG MARE Other departments involved: DG ENV, DG GROW, Legal Services and the Secretariat-General Agenda planning/WP reference: 2011/MARE/063 1.Introduction

This impact assessment (IA) concerns the future framework for managing the demersal stocks and their fisheries in the North Sea in the context of the Common Fisheries Policy (CFP) – the "Basic Regulation" - that entered into force in 2014. The new CFP introduced an obligation to manage fisheries sustainably based on the principle of maximum sustainable yield (MSY). At the same time it introduced an obligation to land all catches that, for the North Sea, will have to be implemented incrementally between 2016 and 2019. The new CFP gives particular emphasis to multi-annual plans as one of the main conservation measure for fish stocks. The current rules governing the demersal fisheries in the North Sea have been heavily criticised as overly prescriptive, ineffective and inapplicable. Additionally, they are not being applied coherently by the Council and the EU Member States. In particular, this is the case for the scheme that currently limits the number of days fishermen can spend at sea. It has created significant administrative burden and caused problems for the catching sector of the North Sea fishing industry by forcing them to apply unsustainable practices like discarding fish for which they do not have quota. The IA presents the problems and challenges produced by the different generations of policy in detail. It defines the objectives with regard to the Basic Regulation, outlines the main policy alternatives and examines the options available to introduce the improvements required for an effective and smooth implementation of the new CFP. The consultation with stakeholders demonstrated almost unanimous preference for a new, flexible multi-annual management plan that would apply to fish stocks fished in mixed demersal fisheries in the North Sea. This plan should be adaptive to the changing realities and conservation needs by facilitating the development of regionalised measures that are consistent with the objectives contained in EU law. Finally, it will provide an opportunity to simplify the current rules that have become overly complex and difficult to enforce. Simplification will contribute to reductions in administrative burden in terms of lessening the number of regulations fishermen will have to comply with and Member States will have to enforce. This stems from the commitments detailed in the Commission's Regulatory Fitness and Performance Program (REFIT) for "Better Regulation". It also addresses the simplification needs outlined in an earlier Commission Communication on the implementation of the CFP . 2.Procedural issues and consultation of interested parties 2.1.Organisation and timing New conservation measures need to be considered for the demersal fisheries in the North Sea that would implement the new CFP and replace the existing management plans for cod and for plaice and sole. The two existing plans have been evaluated by technical experts between 2011 and 2014, with the main conclusions that both plans need substantial revision. Consultation on a new approach to fisheries management in the North Sea has been ongoing since then. This impact assessment concerns the management framework for the demersal stocks and their fisheries in the North Sea. The initiative was planned in 2011 (Agenda Planning 2011/MARE/063) and enshrined in the 2013 Annual Management Plan of the Directorate-General for Maritime Affairs and Fisheries. The long delay in implementing the initiative is due to the negotiations on the reform of the Common Fisheries Policy (CFP) that lasted from 2011 until the end of 2013. The regulation defining the new CFP entered into force on January 1, 2014. Additionally, within that time frame, there were inter-institutional discussions on the respective competences of the Council and the Parliament; their agreement was published in January 2014. The impact assessment report (IAR) was submitted to the Regulatory Scrutiny Board (RSB) on June 8, 2015. The RSB met to consider the IAR on July 1, 2015. The RSB produced a set of comments prior to the meeting, on June 26, 2015, and their opinion was published on July 6, 2015. 2.2.Consultation of the Regulatory Scrutiny Board The impact assessment report (IAR) was revised considerably following the extensive comments received from the RSB. A broad description of the changes, requested in the opinion from the RSB (Ares(2015)2821066 - 06/07/2015) is given below; the detailed changes required in both the opinion and in the impact assessment quality checklist were provided to the RSB separately. The opinion listed four main recommendations for improvement in the following areas: the policy context; the provisions of the multi-annual plan; the analysis of impacts; compliance and monitoring. The policy context: the revised report merged the previous sections entitled "Policy Context" and "Problem Definition" into a new section entitled "Problem Definition". This section now explains in much clearer terms the evolution of fisheries management policy over the last 15 years including the introduction of the existing management plans, the rationale of the new Basic Regulation and the challenges that the various regulations have raised. It explains what instruments the Basic Regulation offers to solve the problems identified. It also explains how the results of an Inter-Institutional Task-Force that resolved inter-institutional stalemate on the new generation of management plans can be used to address the identified problems. Additionally, the objectives section has been redrafted. All objectives are now clearly linked to problems identified in the "Problem Definition" section, to the CFP Basic Regulation or to the multi-annual plan. Provisions of the multi-annual plan: the policy options section has been redrafted. Options that were discarded early in the process are presented separately. This section also explains why the status quo option has been discarded. Among the retained options, the option of a single mixed-fisheries multi-annual plan is presented in more detail, describing in more clarity the relationship with other regional management plans and how the instrument of Regionalisation will be used within the plan. More sub-options are discussed. The report identifies one group of sub-options for which the best option has to be chosen based on qualitative arguments. These qualitative arguments are discussed in detail. A second group of sub-options is identified for which the choice of the best option has to be based on a quantitative analysis. Analysis of impacts: the report presents the analysis of the quantitative sub-options of the multi-annual plan in a more evidence-based format, as requested in the opinion. The results are presented based on the robust, though limited, quantitative support analysis carried out by STECF. Compliance and monitoring: the monitoring and evaluation section now describes potential compliance issues, how the CFP Control Regulation monitors compliance in general and how the Data Collection Framework and ICES advice based on these data provide the tools for constant monitoring. It explains how the new mixed-fisheries plan incentivises compliance. It also depicts how the different components of the initiative will be monitored and evaluated. Further clarification was requested by the board (Ares(2015)4245599 – 12/10/2015) following its scrutiny of the revised IAR. The revised opinion listed four main recommendations for clarification in the following areas: coherence with other initiatives; assessment of impacts; comparison of options; compliance issues. In this third version of the IAR a broad description of the changes is given below:

Coherence with other initiatives: an explanatory footnote has been added in Section 5.2.2 to explain the coherence between the new regional multi-annual plans and the new technical measures framework; a paragraph has been added in Section 5.2.2.1 to further explain the coherence between the new regional multi-annual plans themselves. Assessment of impacts: a more quantitative and detailed breakdown of possible impacts from an economic and social perspective has been given in Section 6.2 for the sub-options of Option 2 – a potential single mixed-fisheries plan for North Sea demersal fisheries using one economic indicator (profitability) and one social indicator (number of vessels) and comparing the outcomes to the baseline option (use solely the Basic Regulation (including the landing obligation)). The data have been taken from the robust, though limited, quantitative support analysis carried out by STECF9. Comparison of options: an extra paragraph has been inserted into Section 7.1 on the assessment against the environmental, economic and social impacts. This better explains how the sub-options of Option 2 compare in terms of effectiveness, efficiency and coherence. Extra text has been inserted into Section 7.3 on "Effectiveness, Efficiency, Coherence and Acceptability" where the impacts of the sub-options of Option 2 can be distinguished. Compliance issues: the text in Section 8.2 has been revised to better explain how compliance will be ensured and why the risk to uneven implementation is believed to be. Additionally, there was a request to more clearly define technical terms. Some of the definitions in the glossary have been revised. A figure has been added in Section 3.1 to explain better the MSY concept and in Section 5.2.2 to explain better the precautionary reference points Blim and Bpa. 2.3.Consultation and expertise In preparing this Impact Assessment, consultation has taken place at different levels, including stakeholders, scientists, public (including public administrations) and Commission services. It has followed a full evaluation process, set-up so that the initial tasks and questions to be addressed have been specified by DG MARE but the key inputs at all steps have come from scientists and other experts, and from stakeholders who have been fully involved throughout the process. 2.3.1.Consultation with Stakeholders Stakeholders have been consulted in a targeted manner during the scoping exercise and through consultation with the North Sea Advisory Council (one of several stakeholder-led organisations established in order to encourage participation by the fisheries sector in the formulation and management of the CFP – see Section 3.1.3). Two scoping workshops have been held. The first workshop was held in Brussels on 27 February 2014. Participants included invited scientific experts and representatives of North Sea Member States and the North Sea and pelagic ACs. This workshop enabled discussion to be initiated on the development and implementation of a mixed-fisheries multi-annual plan for the North Sea. Mixed fisheries are fisheries in which several species are likely to be caught in the same fishing operation (i.e., using the same vessel and gear). A second scoping workshop subsequently took place in Brussels from 29 to 30 September 2014. Participants included invited scientific experts, representatives of North Sea Member States and the North Sea AC (NSAC). Its main objectives were to reach a shared understanding of the new legal and political framework for multi-annual plans, to discuss a draft outline of how the future MAP for the North Sea could look and, through break-out groups, to take forward collective thinking on the possible "building blocks" of the future plan. Additionally there were discussions with the NSAC, through its Mixed Fisheries Focus Group, at meetings in October 2015 in Amsterdam and in March 2015 in Copenhagen10. A wide ranging, internet-based, public consultation was carried out from 9 February to 4 May 2015. A total of 25 detailed contributions were received from Member States, the Advisory Councils (ACs), industry representative organisations, NGOs, and the general public13. Annex I contains a summary of the findings from the public consultation. The main conclusions, which will also be reflected in the relevant parts of the report, were as follows: current management plans are too prescriptive and too complex. They need to be replaced with legislation that is based on strategic objectives and general principles any new management plans should take into account mixed-fisheries interactions the landing obligation presents a major challenge, not only to the fishing industry but also the Member States in the allocation of quotas to the fleets detailed rules should be managed at a regional level, but there has to be coherence with management plans for neighbouring areas many contributors agree on cod, haddock, saithe, whiting, sole, plaice and Nephrops as the main target species. There are varying points of view on the inclusion of additional target species and on the level of protection of other species. In general, the Member States and the fishing industry favour a focus on the main target species, whereas the NGOs want specific objectives for each of the harvested species in the North Sea Technical Measures introduced on the basis of the management plan should be agreed on at a regional level 2.3.2.Expert advice

Most of the work and consultation necessary to cover all of these aspects of the work has been carried out by scientists working through the auspices of the Scientific, Technical and Economic Committee on Fisheries (STECF) and The International Council for the Exploration of the Sea (ICES) as well as by the Marine Resources Assessment Group (MRAG) under a framework contract with the Commission. These bodies had conducted a number of evaluations of the current management plan for cod stocks3 (hereafter referred to as "the cod plan") and the management plan for North Sea sole and plaice4 (hereafter called "the flatfish plan") prior to the reform of the CFP. In the case of the flatfish plan, an impact assessment of options from the first "recovery stage" to the second "management stage" of the plan was carried out by the MRAG in 2009, as such a revision is foreseen in the plan itself once both stocks are observed to be within safe biological limits for two consecutive years. An STECF expert group that met in Vigo in October 2010 also evaluated the flatfish plan. Two meetings took place in 2011 to perform a retrospective review of a number of management plans, including the cod plan3: these were a combined STECF/ICES expert group in Copenhagen in February/March 2011 and a follow-up meeting in Hamburg in June 2011. Both meetings were open to participants from NSAC and Member State administrations. Among the conclusions of these analyses were that the cod plan3 would benefit from linking to plans for Nephrops and haddock, whiting, saithe, sole and plaice in the North Sea and that the plan had not controlled fishing mortality as had been envisaged. The Commission Services took no action to revise either plan at that time due to an inter-institutional dispute over management competencies. Once an Inter-Institutional Task Force to resolve the dispute had presented its conclusions6, and following the adoption of the new CFP, work on the evaluations could take into account the new political context (see Sections 3.1.3 and 3.1.4). In 2014, an STECF expert group met in Varese, Italy, from 10 to 14 March, to prepare a retrospective evaluation of the flatfish plan4. The evaluation was reviewed by STECF at their plenary meeting in Brussels later in March 2014 . The first scoping meeting to discuss and hone the STECF EWG evaluation of the North Sea multi-annual plan options took place from 6 to 8 December 2014 in Varese, Italy. The work planned by that group was subsequently carried out by a full panel of experts in the STECF EWG 15-02 in Varese, Italy from 16 to 20 March 2015. The report9 was reviewed and presented to STECF at their plenary meeting from 13-17 April 2015. 2.3.3.Other relevant studies This impact assessment for a North Sea multi-annual plan is taking place in the context of the new CFP and the redrafting of the technical measures regulations (see Section 3.1). The new CFP includes, inter alia, a new landing obligation, a timeline to reach maximum sustainable yield (MSY) and Regionalisation. Against this background, a number of reports, studies and contracts have provided background on these issues. These include: the reform of the CFP impacts of the introduction of the landing obligation socio-economic dimensions of the CFP the development of a new technical measures regulation mixed-fisheries issues in the EU, including dealing with choke effects considerations on management areas for the new multi-annual plans considerations of managing using MSY 2.3.4.Internal consultation An Impact Assessment Steering Group (IASG) was established in November 2014, which, in addition to DG MARE, comprised representatives from four other Directorates-Generals (DG) and services – Secretariat General (SG); Legal Services (SJ), DG Environment (DG ENV) and DG Internal Market, Industry, Entrepreneurship and SMEs (DG GROW). The IASG met on 3 occasions in 2015 – 23 January, 15 April, 8 May – and worked to finalise a draft of the IA by written consultation following its last meeting. 3.Problem definition The main objectives of the EU's Common Fisheries Policy are the sustainable management of fisheries resources by maintaining healthy fish stocks and providing the conditions for an economically viable and competitive fishing industry. Demersal fisheries in the North Sea have been governed by common rules since the 1970s because the coastal Member States understood the need for a common regulatory framework. Prior to the introduction of a common policy, several demersal stocks were overfished. Overfishing occurs in an unmanaged fishery as every fisherman tries to maximise his catch without paying attention to the long-term consequences for the state of fish stocks. An individual fisherman simply does not have an incentive to catch less than he can. In the end, when stocks decline, the outcome is unsatisfactory for all fishermen. This situation is often referred to as "the tragedy of the commons". Additionally, without regulation, there is no incentive for fishermen to avoid the young fish which have not yet had the chance to reproduce; this further deteriorates the state of the fish stock in question. This section will show that, while regulation is needed to prevent overfishing and discarding, the current rules are outdated and too complex and, therefore, need to be updated.

Figure 3.1.1. Driver and problems in an unregulated fishery. Section 3.1 briefly describes existing relevant legislation and the political context. Section 3.2 describes how traditional fisheries management in the North Sea tried to reduce overfishing and how this approach caused new problems by increasing discarding. Sections 3.3 to 3.6 describe how additional past (management plans) and recent (CFP reform) regulation has more or less successfully addressed problems identified in the preceding sections while at the same time creating new challenges. Section 3.7 describes who is affected by this initiative. Section 3.8 summarises why this initiative is needed while Section 3.9 discusses the legal basis for EU action. 3.1.Existing legislation and political context The following section describes the most important EU legal frameworks regulating demersal fisheries of the North Sea in order to show the context for this initiative. 3.1.1.Annual fishing opportunities regulation Every year, in its annual fishing opportunities regulation, the EU establishes the amount of fish that European fishermen are allowed to exploit from each fish stock. This amount is referred to as the total allowable catch (TAC). This regulation is not adopted under the ordinary legislative framework but solely by Council, upon proposal by the Commission. This deviation from the ordinary procedure is fixed in Article 43(3) of the Treaty on the functioning of the European Union (TFEU). The Commission bases its proposals for the annual fishing opportunity regulations on annual scientific advice provided by ICES15. 3.1.2.The "old" CFP Regulation (EC)2371/2002 and management plans derived from it Council Regulation (EC) 2371/2002, the pre-reform Basic Regulation, constituted a horizontal regulation containing the most important rules on fisheries management in the EU. The Regulation foresaw the use of management plans of which the basic description of role and content could be found in its Articles 5 and 6. The ethos of these plans was to address the problem that, prior to 2002, there were no constraints to Council's decision to setting TACs. Hence, TACs were often set at too high levels and the size of many fish stocks subsequently declined. These plans limited the freedom of Council when deciding on annual fishing opportunities; they gave binding guidance when translating scientific advice into tangible annual TACs. In the North Sea there are currently two management plans, introduced in 2007 and 2008 respectively: the flatfish plan, for plaice and sole, and the cod plan were both adopted in the form of Council Regulations (Council Regulation (EC) No 676/2007 and Council Regulation (EC) 1342/2008 respectively). It is important to note that although Regulation (EC) 2371/200236 is no longer in force, the management plans derived from it still are. 3.1.3.The new Basic Regulation In 2013 a new Basic Regulation of the Common Fisheries Policy5 was adopted as the cornerstone of a broad reform of the policy, replacing Regulation (EC) 2371/200236. Its main elements are listed in Annex II. The new Basic Regulation obliges the EU to manage its fisheries sustainably, based on the principle of Maximum Sustainable Yield (MSY). The MSY is the catch of a fish stock that optimises the yield from that stock in the long term. As another important measure, the Basic Regulation bans the discarding of fish (see Section 3.4.1). The Basic Regulation also foresees the use of management plans, now called multi-annual plans. These multi-annual plans are supposed to implement the Basic Regulation and to enable its objectives, especially with regards to sustainable MSY-based fisheries management. In some narrowly defined cases, multi-annual plans are allowed to deviate from the provisions of the Basic Regulation (see Section 3.6). The current management plans like the cod3 and the flatfish4 plans do not fit into this structure as they were adopted prior to the latest CFP reform. In many aspects they are contradictory to the new Basic Regulation (see Section 3.5). Another important innovation introduced by the new Basic Regulation is the so-called "Regionalisation". Regionalisation is the reform's reply to the common and long-lasting accusation of micro-management i.e. that in the CFP too many detailed decisions are taken in "Brussels", far away from the stakeholders concerned. The Basic Regulation lays down the concept of Regionalisation in Article 18 as a blueprint to be used in future CFP legislation. The concept is supposed to be used for detailed, rather technical, provisions to achieve the objectives of a regulation. It foresees that fisheries regulations, where appropriate, include an empowerment to the Commission to adopt these rather technical provisions in a Delegated Act. The difference to the ordinary case of Delegated Acts is that the Commission invites the Member States that are affected by these provisions to collaborate to formulate Joint Recommendations on the measures to take. There is a strong political commitment from the Commission to include measures into these Delegated Acts that are only agreed unanimously by the concerned Member States. The aim of Regionalisation is to increase the involvement of the Member States affected by regulation and thus to increase their identification with the measures. The Commission's role is to ensure that the adopted measures are suitable to fulfil the objectives of the basic act. Regionalisation thus constitutes an important shift from instrument-based to results-based management. Regionalisation also gives a stronger voice to Advisory Councils (ACs) which have to be consulted when formulating Joint Recommendations (Art. 18(2) of the Basic Regulation). ACs are stakeholder organisations, established by the previous CFP reform in 2002, that bring together the industry (fishing, processing and marketing sectors) and other interest groups, such as environmental and consumers' organisations. ACs are separated by Sea Basins. Annex III of the Basic Regulation foresees an AC for the North Sea area – the North Sea Advisory Council (NSAC) - and delineates its exact area coverage to ICES Subarea IV and Division IIIa. In practice, Regionalisation in the North Sea area will be delivered by the Scheveningen group which is a group of Member States cooperating on fisheries policy, established in 2013. Members are Denmark, Sweden, Germany, Belgium, the Netherlands, the UK and France. So far, the Commission has received two Joint Recommendations from the group: one in 2014 for the pelagic discard plan and recently another one for the demersal discard plan. The Commission has submitted the recommendations to STECF in order to assess their compatibility with the CFP. After a positive assessment is received, Commission proceeds to adoption of a delegated act that contains the elements proposed by the Joint Recommendation. The regionalisation procedure in the North Sea and the cooperation between members of the Scheveningen group and the Commission has already proven effective when adopting the discard plan for small pelagic and industrial fisheries in the North Sea in 2014. 3.1.4.Lisbon Treaty, inter-institutional conflict and its resolution

Prior to the changes introduced by the Treaty of Lisbon (the Treaty on the Functioning of the European Union or TFEU35), fisheries legislation was adopted by the Council based on Commission proposals. Since the Lisbon Treaty, fisheries legislation is now subject to the ordinary legislative procedure with the derogation with regards to "measures on […] the allocation of fishing opportunities" (Article 43(3) of the TFEU35), i.e. the setting of annual TACs, remaining under control of the Council (see Section 3.1.1). The entry into force of the Lisbon Treaty led to a dispute between the European Parliament and the Council on the subject of multi-annual plans, as on the one hand they affect the setting of annual TACs, a Council competence, and on the other hand they go beyond the annual TAC setting exercise by taking a multi-annual policy perspective, suggesting that the Parliament should play a role. An Inter-institutional Task Force comprising the three main EU Institutions (Commission, Council and Parliament) was therefore convened, in September 2013, to solve the delicate inter-institutional controversy that emerged on the sharing of competences. In its final report, issued in April 20146, the Task Force suggested, as a solution to the stalemate, a framework where multi-annual plans would be adopted under the ordinary legislative procedure while a certain margin for discretion would be kept for Council's annual TAC decisions. The solution would be to use ranges, rather than point values, of FMSY when defining the amount of fish that is allowed to be caught through fishing every year in a multi-annual plan. Council would then, for the species covered by a plan, have to fix TACs within the ranges provided for in the plan. ICES provided ranges that give a long-term yield from the stock that is at least 95 percent of the yield if the FMSY point-value was being used (see and Figure 3.1). Beyond the resolution of the inter-institutional conflict, the Task-Force also agreed to include biomass safeguards into the plans. These biomass safeguards are thresholds that trigger remedial action if the biomass of a stock falls below a certain limit. The rationale for this is that exploiting a stock based on FMSY is the sustainable choice in most cases but it can put a stock at risk if the stock's biomass is very low. In such a situation it is advisable to adopt a TAC based on a lower exploitation rate or to take other measures that reduce the fishing mortality for this stock. Article 2(2) of the Basic Regulation requires fishing at FMSY or below and adherence to the precautionary principle. Biomass safeguards can be regarded as a concrete manifestation of the precautionary approach to fisheries. Figure 3.1. Example of yield (production) versus fishing mortality (F) for a hypothetical fishery. SSB: spawning stock biomass. The peak of the production function is MSY and the fishing mortality generating this peak is FMSY. The Task-Force results have already been followed in adopting a Commission proposal for a multi-annual plan for the stocks of cod, herring and sprat in the Baltic Sea. Both co-legislators have received the proposal positively, adopted their respective positions and have been negotiating on the final text in trilogues since June 2015. 3.1.5.Technical measures regulations Another important tool to manage fisheries in the EU has been to prescribe technical measures, i.e. measures establishing conditions for the use and structure of fishing gear and restrictions on access to fishing areas. There are a large number of technical measures in place for fisheries exploiting stocks in the North Sea. At present, these are mainly contained in the main technical measures regulation (Council Regulation (EC) No. 850/1998). The measures include gear specifications, minimum percentages of target species and by-catch limitations by mesh size and area as well as a variety of closed areas and seasons. The reasons for the technical measures vary but very often they are in place to increase avoidance of unwanted catches and thus reduce discards. The Commission is working towards a new framework for technical measures to adapt it to the logic of the reformed CFP where discard avoidance is already strongly incentivised by the Basic Regulation (see Section 3.4.1). Preparation and consultations on this issue are taking place in parallel with the North Sea multi-annual plan. 3.2."Traditional" management of North Sea demersal fisheries: The problem of discarding In the North Sea and adjacent areas a wide range of different fish and shellfish species are exploited, among them many demersal species. Demersal fish are fish that live at or near the bottom of the water column, e.g. cod and haddock. The North Sea demersal fishery is a mixed fishery: fishermen unavoidably catch a mixture of demersal species at the same time. They cannot control (or only to a limited extent) the composition of their catches. Fisheries in the EU are traditionally managed by defining and prescribing annually the amount of fish that can be fished in the coming year for each stock. This amount is divided among Member States following a fixed allocation key and then, in most of the cases, it is shared out to fishing enterprises at the Member State level. If fishermen run out of quota for a particular stock ("stock A") and they still have quota available for another in the same mixed fishery ("stock B") they are allowed to keep on fishing. Fishermen simply throw catches of stock A back into the sea. They also discard catches of young fish because EU legislation stipulates that they are not allowed to land catches below a certain size in order to avoid the emergence of a market for such young fish and thus further incentives for fishermen to catch young fish. Discarded fish does not survive in most cases29. The discarded part of the stocks is thus wasted; the stocks are effectively economically underutilised. While TACs reduce overfishing, they create new externalities by the fact that over-quota catches are being discarded and hence wasted. Another problem stems from the fact that the true amount of discarding is unknown and is therefore only partially taken into account when setting the annual TAC. The TAC does then not fully reflect the amount of fish that is really killed due to fishing. This is one among several reasons why TACs are often set too high and the stocks are overfished. Figure 3.2.1. Traditional management and the new problems it creates. Rectangle: policy measure; diamond: problem; solid line: leads to unwanted result; dashed line: reduces / removes problem. 3.3.Solutions and problems stemming from current North Sea Management Plans In the North Sea, the system described in the previous section has led to significant discarding and could not prevent overfishing37. The stock that has been most negatively affected by the right to discard over-quota fish is the cod stock. Therefore, when introducing the cod management plan3 (see Section 3.1.2), the EU decided to protect the cod stock by introducing another regulatory system in addition to the TAC system. The cod plan3 introduced limitations of "days at sea", i.e. to the time that fishermen are allowed to spend at sea. The system tried to protect the cod stock by generally limiting demersal fishing in the North Sea, including fishing for other stocks where cod is caught as an unwanted by-catch. The plan incentivised fishing methods that avoid involuntary catches of cod by allowing Member States to increase the days at sea of their fishermen if they could prove that the cod by-catch of these fishermen is very low. A comparable system of days at sea has also been applied in the flatfish plan4. Figure 3.3.1. The North Sea management plans – partial solutions and new problems. Rectangle: policy measure; diamond: problem; solid line: leads to unwanted result; dashed line: reduces / removes problem. These current management regimes are considered by Member States, the fishing industry, scientists22-31, and environmental organisations as ineffective, overly prescriptive, unnecessarily burdensome and economically damaging for the EU fishing industry. In particular, the “days at sea” regime has been at the centre of criticism. In its evaluation of the cod plan19, STECF concluded that the plan had not controlled fishing mortality as envisaged and that the short-term economic impacts of the management plan were not clear. With regards to the flatfish plan, STECF concluded that the observed recovery of sole and plaice was unlikely to stem from limitations on days at sea20. The ability of the days at sea regime to address the problem of discarding has therefore been rather mediocre.

The cod plan3 has also been heavily criticised for envisaging further restrictions even when the cod stock in the North Sea started to recover in recent years. Its effect has been not only to limit fishing for cod in the North Sea, which accounts for approximately 5% of the fish landed, but also to prevent fishing vessels from leaving port even when they own legitimate fishing quota for the 95% of other fish. That consequence has been criticised as grossly unfair and disproportionate throughout the fishing sector. The days at sea regime has also been criticised for having perverse effects that damage the environment rather than preserving fish stocks, for instance because vessels with a limited budget of fishing days have to fish close to shore where juvenile fish concentrates. Similarly, the North Sea fishing industry has argued in the Public Consultation to this initiative (see Annex I) that severe restrictions on the time they can spend at sea makes it more difficult for them to seek fishing areas with lower cod abundance, so the restrictions exacerbate the problem of unwanted cod catches in the mixed fisheries. Moreover, the days at sea management scheme has created significant administrative burden for the Commission and Member State administrations. Since 2011, the Council has been calling on the Commission to submit a proposal to replace the cod plan, which it considers ineffective and discredited. In 2012, the Commission adopted two proposals , for amendments of the cod plan3. The first was to align it to the Lisbon Treaty; the second to amend it to provide interim solutions to its most pressing problems, pending the development and implementation of a mixed-fisheries plan for North Sea fisheries. In December 2012, Council decided to split the COM proposal COM (2012)049849 and unilaterally adopted a Council Regulation (EU) amending the cod plan . That amendment removed some of the most burdensome rigidities of the cod plan but without putting in place a scheme that would allow management of the cod stock effectively as part of a mixed fishery. The European Parliament and the Commission have each brought an action against the Council to the European Court of Justice (ECJ) for the annulment of that regulation . It is likely that the judgement of the ECJ will lead to its repeal51. This would re-establish the previous version of the cod plan which is considered as unworkable and inapplicable. To sum up, the system of days at sea restrictions is ineffective, very bureaucratic and has not gained acceptance among fishermen. In the Public Consultation (Annex I) the fishing industry gave a clear message that the restrictions on days at sea in the two existing plans are very unpopular as they are unworkable, not sufficiently adaptive, and/or counterproductive. Additionally, the current plans have been criticised for not being flexible enough to address the issues that have evolved during their implementation. For these reasons, the plans can be regarded as regulatory failure which should be addressed by this initiative. More importantly, the plans can be regarded as pieces of outdated regulation because the problem of discarding in mixed fisheries is being addressed in a more thorough way by the new Basic Regulation of the CFP which will be described in the next section. 3.4.CFP-reform: solving problems, creating new challenges 3.4.1.Ending discarding and overfishing The new Basic Regulation adopted in 2013 includes a new approach to solve the problems of overfishing and discarding. The new Basic Regulation bans discarding by introducing an obligation to land all catches; this obligation is being introduced stepwise between 2015 and 2019. The landing obligation implies that fishermen have to stop fishing when they run out of quota for one of the stocks that they catch – discarding will simply no longer be allowed. This provision is supposed to trigger behavioural change on many levels. The Commission expects Member States to attribute fishing rights to their fishermen in a way that reflects, as far as possible, the expected mixture of species caught. Fishermen are expected to change behaviour because they now have a much bigger incentive to avoid stocks that they do not want to catch because they would have to "pay" with valuable quota for these catches. Under the old management, the discarded catch was not counted against the quota for that species. Under the landing obligation, however, not only do all fish caught have to be landed but all fish caught will now be counted against the quota for that stock. The landing obligation should therefore trigger innovation in fishing gears, techniques and strategies. At the same time Article 2(2) of the new Basic Regulation makes the concept of Maximum Sustainable Yield (MSY) legally binding. Where possible by 2015, and at the latest by 2020, the EU cannot set total allowable catches above levels that comply with the MSY concept. Therefore, once FMSY has been reached for any particular stock, the annual fishing opportunities need to be set at the level necessary to ensure that exploitation does not exceed FMSY for that stock. These two central measures of the CFP are expected to solve the problem of overfishing and resource wastage caused by discarding. Figure 3.4.1. The CFP reform – a comprehensive solution. Rectangle: policy measure; diamond: problem; solid line: leads to unwanted result; dashed line: reduces / removes problem. 3.4.2.New challenge: "Choke" species and underfishing However, the rule that states that fishermen have to stop fishing when they run out of quota for just one of the stocks caught in the mixed fishery will create new problems. Some stocks will probably be underfished in the future, because the entire fishery will have to be closed when another stock's quota has been used up. Such a stock which restricts fishing in a mixed fishery is often referred to as a "choke species". The problem will be aggravated by the obligation to apply the MSY concept to all stocks simultaneously because it will not be possible to allow (temporary) overfishing of a stock that "chokes" the fishery. Due to the fluctuations in the abundance of the different fish stocks, different species might become choke species in different years. The resulting underfishing could threaten the economic viability of the fishing industry. Figure 3.4.2. The CFP reform – creating new challenges. Rectangle: policy measure; diamond: problem; solid line: leads to unwanted result. Under the impact of the landing obligation, where no discarding is allowed, cod has the potential to be a choke species, given the significant degree of historical over-quota catches (currently discarded) of cod. These over-quota catches appear to be increasing in recent years, as shown in Table 3.4.2.1 giving the proportions of over-quota catches where 1.0 expresses an exact match of catches and TAC and >1.0 expresses catch figures that are higher than the TAC). Table 3.4.2.1. Over quota catches of cod in the North Sea

Year 2010 2011 2012 2013 2014 Cod 1.2 1.4 1.4 1.4 1.6 Table 3.4.2.2 illustrates the hypothetical effects on the landed value for seven demersal species caught together in the North Sea if the landing obligation were already fully applied to cod in 2015. There are clearly significant reductions in the quantities of other demersal species that could be landed, with highly significant impacts on the reduction in value.



Table 3.4.2.2. The hypothetical effects on landings, in tonnes, and value, in euros, for seven North Sea demersal fish species based on the cod scenario in the mixed-fisheries advice for 2015 where, once the North Sea cod quota is caught other fisheries catching cod would have to cease. Species Single species landing advice 2015 (t) Landings (t) if landing obligation fully applied 2012 value per ton (€) % change in landed value compared to single species advice Cod 26713 26713 2.72 0 Haddock 48176 16592 1.28 -66 Plaice 128376 60175 1.41 -53 Saithe 72854 45797 1.30 -37 Sole 10973 6469 9.36 -41 Turbot 2406 1972 8.22 -18 Whiting 17190 9654 1.27 -44 The problem is not limited to the cod stock. An analysis of these issues for the North Sea fisheries was undertaken by the STECF29, which showed that for all Member States and for a number of stocks, catches were well in excess of the available quota which indicates that these stocks would become choke species under a landing obligation. The most important findings of this STECF report are provided in Annex III. The landing obligation will be introduced in the North Sea demersal fishery stepwise for catches from different species between 2016 and 2019. Therefore, the problem of underfishing is not imminent yet but will evolve from the legislation that is already in place. 3.4.3.New challenge: the costs of landing all catches Another problem created by the Basic Regulation is the costs of the landing obligation that fishermen have to bear. These costs notably stem from having to sort and record additional catches, and store them on board until landed, while not being allowed to market them for human consumption. In some cases, especially when the stock which is being discarded is in a good state, has low economic value or discarded amounts are relatively small, the obligation to land all catches might be a disproportionate measure. To sum up, the CFP reform solves the problem of overfishing and discarding but, when applied strictly, may lead to the problems of disproportionate costs and underfishing. 3.5.Mismatch between the current management plans and the Basic Regulation Some provisions of the cod plan3 do not match with the new Basic Regulation. Most importantly, the current plans include rules on how to define the annual fishing opportunities that are not in line with the principle of MSY foreseen by the Basic Regulation. 3.6.Solutions foreseen in the CFP Basic Regulation The Basic Regulation introduces a binding timetable for implementing the landing obligation, but it also foresees ways to address the challenges described above. Before the entry into force of the landing obligation in a specific fishery, Article 15(5) of this regulation allows for the adoption of exemptions from the landing obligation for species that have a high chance of survival when thrown back into the sea. Exemptions can also be granted "where scientific evidence indicates that increases in selectivity are very difficult to achieve" (Article 15(5)(c)(i)) or to avoid "disproportionate costs of handling unwanted catches" (Article 15(5)(c)(ii)). The Basic Regulation contains the right for the Commission to adopt these exemptions in a Delegated Act for a transitional period of no more than three years. The Basic Regulation stipulates that these Delegated Acts, commonly referred to as "discard plans", are developed following the Regionalisation method described in Section 3.1.3. According to Article 15(5) of the Basic Regulation, any exemptions that are supposed to be valid for a period longer than three years can only be adopted as part of a multi-annual plan. Another way towards a solution can be found in the Inter-Institutional Task Force's proposal to use fishing mortality ranges instead of the point estimate of FMSY (see Section 3.1.4). This would enable management of the mixed fishery by allowing some more room for manoeuvre to set TACs in a way that avoids underfishing and thus reduces economic and social losses caused by the "choke species" problem. An additional solution, not explicitly foreseen in the Basic Regulation but developed by the Inter-institutional Task-Force (see Section 3.1.4) is the "decoupling" of mixed fisheries by prescribing specific technical measures that increase selectivity. The Task-Force final report6 foresees room for such measures especially for by-catch stocks in a mixed fishery and foresees the use of the regionalisation procedure (see Section 3.1.3) to develop such measures. 3.7.Who is affected? The fisheries of the North Sea and adjacent areas involve vessels from Belgium, Denmark, Germany, France, the Netherlands, Sweden and the United Kingdom, as well as Norway, using a wide variety of different fishing gears to target a wide range of different fish and shellfish species. According to the 2014 STECF Annual Economic Report, in 2012, the North Sea fleet comprised some 5800 vessels, varying in size from 6 m to greater than 40 m in length. Employment within the North Sea fleet (in terms of full time equivalents) was around 9300 people. The weight and value of landings generated by the EU North Sea fleet in 2012 amounted to approximately 1.1 million tonnes and almost €1.5 billion respectively. The UK, French and Danish North Sea fleets together accounted for around 73% of the total days at sea in the region (See Annex IV for more detail on the North Sea demersal fisheries and stocks). In the North Sea, demersal trawls and seines and beam trawls were the two most important gears with respect to both the total weight of species landed (64%) and the total value of species landed (68%) by the EU North Sea fleet in 2012. The majority of demersal fish landed are caught in these gears. The numbers of vessels and employment for vessels using these gear categories (relative to all other gear types), for each Member State, for the top 35 fleet segments, are given in Table 3.7.1. Overall, these data show that, in 2012, these two demersal gear categories accounted for 20% of the vessels and more than 55% of the employment of the entire North Sea fleet. Table 3.7.1. Numbers of vessels and employment in the EU North Sea fleet in 2012 by gear type and by Member State for the top 35 Member State fleet segments56 in terms of landed value. Employment is given as Full Time Equivalents (FTEs). EU Member State Demersal trawls / seines Beam trawlers Other gears Fleet size FTEs Fleet size FTEs Fleet size FTEs Belgium 0 0 58 157 0 0 Denmark 218 665 0 0 62 234 France 57 297 0 0 186 505 Germany 15 128 181 286 0 0 Netherlands 21 84 255 906 13 75 Sweden 66 232 0 0 0 0 UK 268 2100 20 118 1026 940 Totals 645 3506 514 1467 1287 1754 % of total NS fleet 11 38 9 16 22 19

However, for individual Member States, the dependence on the demersal fleets can be much higher than the overall figures. For example, the demersal sector of the Belgian and German fleets comprises over 75% of their North Sea fleet in each country (Table 3.7.1), with the Dutch fleet having around 50% of its vessels in the demersal sector. In terms of employment, only France has significantly less than 50% of the North Sea fleets' employment in the demersal catching sector. The catching sector for North Sea demersal fish is, demonstrably, very important to the Member States surrounding the North Sea. It comprises a high proportion of the fleet size, employment, landed value, landed weight, fishing time (days at sea) and GVA for the majority of those Member States (Table 3.7.2). Clearly, any negative impacts on the demersal catching sector have the potential to impact those Member States. Within the top 35 North Sea fleet segments56, the demersal catching sectors in Belgium, Germany and the Netherlands represent over 80% of the landed value of North Sea landings. Sweden's demersal sector provides over 93% of its landed weight; the figure is greater than 80% for Belgium and Germany. In terms of gross value added (GVA), GVA from the demersal catching sectors in Belgium, Germany, the Netherlands and Sweden is in excess of 70% for each of their North Sea fleets; it is around 50% for the UK.

Table 3.7.2. Percentages of various categories, by Member State, represented by the demersal sector in 2012 for the top 35 Member State fleet segments56 in terms of landed value. Employment is given as Full Time Equivalents (FTEs) EU Member State Fleet size (%) FTEs (%) Landed value (%) Landed weight (t) (%) Days at sea (%) GVA (%) Belgium 77 73 81 81 74 84 Denmark 21 56 45 40 43 38 France 10 23 36 39 14 21 Germany 79 77 84 86 82 85 Netherlands 49 78 84 53 87 84 Sweden 13 46 70 93 22 70 UK 10 52 50 37 22 48 Additionally, there is a shore-based processing sector that deals with the North Sea fish catch. Figures for the numbers of enterprises and employment within the sector in each of the North Sea Member States are given in Table 3.7.3. Note that in most cases the enterprises will be processing catches from other areas as well as the North Sea. In terms of employment, 61% of these enterprises are micro-businesses and 37% are SMEs . Table 3.7.3. Numbers of enterprises and employment in the processing sector of North Sea EU Member States in 2012. Number of enterprises by size (No. of employees) Employment (FTEs) No. of employees: ≤ 10 11-49 50-249 ≥250 Total Belgium 206 28 5 1 240 2492 Denmark 57 30 19 0 106 3409 France 133 108 39 15 295 16184 Germany 171 56 15 8 250 7010 Netherlands 35 33 16 0 84 3567 Sweden 190 25 8 0 223 2135 UK 166 133 64 12 375 19070 Total 958 413 166 36 1573 53867 The other stakeholders most affected by this proposal would be the sector regulators in the Member States. Any changes to the regulatory structure will require a re-adjustment of the management regime. Sectors' research agencies will also be affected as changes in management measures will require experimentation and evaluation of these new measures. 3.8.Summary The EU has tried, for decades, to solve the main problems in the North Sea demersal fisheries: overfishing and discarding. Currently, old instruments (the current management plans and their days at sea schemes) and a new instrument (the new Basic Regulation) are in force at the same time, all aiming to solve these problems. The current management plans have failed to solve these problems satisfactorily while creating new problems. They can therefore be regarded as regulatory failure. At the same time they are outdated because the Basic Regulation addresses the same problems in a different way. The Basic Regulation promises to solve the problems of overfishing and discarding more effectively. However, this regulation is too strict as it leads to underfishing and imposes a landing obligation even in situations where such an obligation is disproportionate. Hence, if no alleviating measures (exemptions from the landing obligation beyond the 3 years discard plans, flexibility with regards to MSY in a mixed fishery, technical measures to "decouple fisheries") are taken, the Basic Regulation will most likely have negative economic and social consequences for the fishing industry in the coming years. 3.9.Legal basis for the EU to act According to Article 3(1)(d) of the TFEU35, the Union shall have exclusive competence in the conservation of marine biological resources under the CFP. Article 43(2) of the TFEU35 establishes the Union’s power to adopt the provisions necessary for the pursuit of the objectives of the CFP. The problems identified in this section clearly relate to the conservation of marine biological resources; they therefore have to be resolved by the EU. Hence, there is no need to justify measures with regards to the principle of subsidiarity. Nevertheless, the reformed CFP gives the EU the possibility to move decision making closer to the affected stakeholder by making use of Regionalisation (see Section 3.1.3) thus living up to the spirit of subsidiarity. 4.Objectives 4.1.General objectives The current initiative complements the CFP reform and helps to implement it for the North Sea demersal fisheries. It therefore has to be in line with objectives of the CFP Basic Regulation which are stated in its Article 2. Of particular importance for this initiative are the following objectives: to provide a transparent framework to achieve the maximum sustainable yield exploitation rate (FMSY) by 2015, where possible, and by 2020 at the latest to apply the precautionary approach the simplification of EU legislation and of the management of European fisheries

4.2.Specific objectives Having identified the main problems that occur in the North Sea demersal fisheries, or that will occur once the landing obligation is introduced, the following objectives for this initiative can be derived: to reduce the extent of underfishing in a mixed fishery under a landing obligation (see Sections 3.4.2) by introducing FMSY ranges (see Sections 3.1.4 and 3.6), to establish biomass safeguards in order to enable the precautionary approach established in Article 2(2) of the Basic Regulation (see Section 3.1.4) to facilitate the application of the landing obligation introduced in the reformed CFP (see Sections 3.4.2 and 3.4.3 and 3.6) to establish the framework necessary for the implementation of Regionalisation within the North Sea area (see Sections 3.1.3 and 3.6) to remove the days at sea regime which has proven to be ineffective and which is no longer necessary given that the new Basic Regulation addresses the same underlying problems with different means It should be noted that the specific objectives are partly linked to each other. Facilitating the application of the landing obligation by granting exemptions from this obligation could help to reduce the risk of underfishing in a mixed fishery. Establishing a framework for the implementation of Regionalisation within the North Sea area makes it significantly easier to adopt technical measures that decouple mixed fisheries. Hence, Regionalisation equally has a potential to contribute to reducing the risk of underfishing (see Section 3.6). Another important objective of the CFP is to minimise negative impacts of fishing activities on the marine ecosystem (Basic Regulation, Article 2(3) and to be coherent with the EU environmental legislation (Basic Regulation, Article 2(5)(j)). Any initiative taken within the Common Fisheries Policy shall therefore avoid being detrimental to these objectives and where possible should help to achieve them. An additional important objective of the CFP is to achieve "economic, social and employment benefits" (Article 2(1)) and to "provide conditions for economically viable and competitive fishing capture and processing industry" (Article 2(5)(c)). This initiative will contribute to achieving this objective by preventing underfishing and by simplifying legislation. 5.Policy options A screening of different policy options has led to the identification of those policy options that are most likely to meet the objectives and address the problems identified in Section 3. The four options considered are the existing management approach, amending the existing plans, managing solely according to the new CFP (the Basic Regulation), and establishing a single mixed-fisheries multi-annual plan. The first two options (existing management approach, amending the existing plans) have been discarded early on. The reasons for this will be explained in the following sub-sections. Subsequently, the remaining two options will be discussed in more detail, including sub-options for a potential mixed-fisheries multi-annual plan. 5.1.Discarded options 5.1.1.No policy change at EU level The first option is the status quo option or no policy change at EU level, i.e. to continue to apply the existing management (i.e. cod3 and flatfish4) plans, in combination with all other existing rules of the new CFP. Under this option none of the objectives of this initiative would be reached. It would not provide a transparent framework on how and when to achieve the maximum sustainable yield exploitation rate (FMSY). Instead it would provide for contradictory management objectives, i.e. the fishing mortality rates stated in the existing plans and the MSY objective stated in the Basic Regulation. The unilateral amendment by Council to the cod plan (Council Regulation 1243/2012) see Section 3.3), deemed illegal by Commission and Parliament, does not change the fishing mortality rate stated in the plan and therefore does not solve the problem. This option would also not introduce ranges for FMSY. The current plans only include biomass safeguards for the cod stocks, therefore, the objectives of applying the precautionary approach and establishing biomass safeguards cannot be reached for all other stocks in the North Sea. Under this option, it would not be possible to replace the discard plans after they have lapsed. The landing obligation would thus also be applied in cases where this is disproportionate (see Section 3.4.3). Moreover, this option does not enable Regionalisation in the North Sea and would not do away with days at sea management, a policy that has been strongly criticised at many levels (see Section 3.3). Due to the contradictory provisions that would be in force, this option clearly does not reach the objective to simplify legislation. Additionally, stakeholders clearly reject this option13. In the public consultations for both the North Sea multi-annual plan and for the new framework for technical measures the catching sector gave a clear message that the restrictions on days at sea in the two existing plans are very unpopular as they are unworkable, not sufficiently adaptive, and/or counterproductive. Both the catching sector and the Member States consider that these restrictions would be unnecessary or even counterproductive when the landing obligation enters into force and the administrative burden of implementing them would therefore no longer be justified. Additionally, the current plans have been criticised for not being flexible enough to address the issues that have evolved during their implementation. The Member States directly concerned have requested to replace these plans as soon as possible. There are high expectations by all stakeholders that these plans will be replaced. In addition, there are expectations, e.g. from the European Parliament, to bring more fisheries under multi-annual plans in the future. In 2012 the European Parliament adopted a resolution which "calls on the Commission to provide for the establishment of long-term management plans for all EU fisheries".

This "no-change"-option has been discarded very early in the process, not only because none of the problems identified above would be resolved but also because under this option contradictory, competing legislation would be in force; it would, therefore, be unclear which of the legislations would be enforced. The "no-change"-option is therefore not an appropriate baseline against which the other options can be assessed. 5.1.2.Amendment of the existing management plans This option would enable an update and review of the existing management plans, and subsequently consider the introduction of a series of new single-species plans. Existing (cod and flatfish) plans would be updated to meet the challenges of the new CFP reform, and in light of their evaluations – adjusting to FMSY, reviewing elements such as days at sea restrictions, etc. Over time new, additional, plans could be introduced for stocks not currently under a management plan. This would entail the development of between 7 and 9 plans for the demersal fish stocks for which ICES currently provides scientific advice on maximum sustainable yield41, and potentially a further 23 plans for other commercially important stocks. Some of the objectives of this initiative can be achieved by this option in exactly the same way as under a single mixed-fisheries multi-annual plan: a transparent framework for FMSY as well as FMSY ranges and biomass safeguards could be established; days at sea management could be abolished. These elements will be discussed in more depth in the section dealing with the option of a single mixed-fisheries multi-annual plan (see Section 5.2.2). However, keeping and amending the existing plans would make it difficult to achieve the objectives of implementing regionalisation and facilitating the introduction of the landing obligation. This is because integrated approaches to the implementation of the landing obligation (introduced per fishery) or of technical measures to be introduced at a regional level would be virtually impossible because the same technical measures applying to fishing different stocks would have to be introduced in separate delegated acts based on different (multiple) single-stock plans – and would therefore create a proliferation of delegated acts. This would also be the case for the implementing rules governing the landing obligation and possible exemptions from this obligation (see Section 3.6). In a mixed fishery it would be unclear which of the species/stock-based plans would have to include details on the fisheries-based phasing in of the landing obligation. Additionally, future exemptions from the landing obligation for the North Sea would need to be distributed over many different plans instead of being contained within one document as is the case for the current discard plans. The foreseen outcome would create a very complex legal framework, with complicated management challenges and most likely increased administrative burden in developing each plan and implementing and updating them to ensure coherence between them. The risk of unforeseen loopholes would also need to be considered. The objective of simplifying legislation would clearly not be met. The Public Consultation showed that, among stakeholders, there has been strong criticism of the complexity of the existing legislation, so any further complications arising from a multiplicity of plans are unlikely to be welcomed. Additionally, Member States consider that no time should be spent on amendment of the plans in force and focus instead should be on development of a new multi-annual plan for the North Sea mixed fisheries. There is general support by stakeholders that the existing plans should be replaced by a new holistic plan (see Annex I). This option would address some of the objectives in the same way that a mixed-fisheries plan can (i.e. provision of a transparent framework; introduction of FMSY ranges; application of the precautionary approach; removal of the days at sea regime). However, there are difficulties to solve the remaining problems that a single-species plan can address more easily (i.e. facilitation of the landing obligation; Regionalisation; simplification; see Section 5.2.2); therefore this option has also been discarded. 5.2.Potential policy options 5.2.1.Use solely the Basic Regulation (including the landing obligation) This option would aim at repealing the two existing multi-annual plans (the cod plan3 and the flatfish plan4) and apply only the Basic Regulation, including the landing obligation. This option would mean that for every (of the around 40 – see Annex IV) stock in the North Sea the management obligation is to achieve MSY by 2020 at the latest. This means that the TACs that are set annually for all stocks must respect MSY objectives, using the point estimate value of FMSY as a target. TACs are set on a single-stock basis, where there may be no consideration of mixed-fisheries interactions. This has proven in the past to lead to mismatches in the quota basket for fishermen and Member States, normally having discarding as a potential consequence. With the landing obligation, a large number of stocks would turn into choke species under this option (see Section 3.4.2). As a consequence, either the fishery would need to be stopped completely before the end of the season – to ensure that the conservation objectives are met and the TAC is respected – or, alternatively, fishermen would continue to fish for species for which they still have quota, in combination with illegal discarding. The latter, though hard to estimate quantitatively, would lead to a deterioration of catch data, distortion of stock assessments and the risk of structural (not identified) overfishing of the choke-species' stock. A quick remedy would need to be found whereby cod could be isolated (decoupled) from the other demersal species, in particular from haddock, by means of technical measures (see Section 3.6). Such short-term remedies are not foreseeable under the Basic Regulation, especially in the absence of adaptable technical measures or alternative conservation measures – which would have to be adopted through co-decision: the inflexible governance structure (no regionalisation) would hinder stock conservation. This option would operate within the existing framework of technical measures under co-decision, implying very limited adaptability of the technical rules to new situations or requirements. In addition, the lack of flexibility and adaptability in, notably, the technical measures legislation, rules out the possibility to introduce more selective and avoidance fishing strategies and techniques to a significant degree. Individual fishermen will see no driver to change the behaviour when others don't participate – which is typically the argument for the tragedy of the commons. In the absence of these adaptations of fishing gears and of fishing strategies, the choke species phenomenon will continue to hamper the fishing industries. This option would also imply that the implementation of the landing obligation in North Sea demersal fisheries would have to proceed without any facilitating practical measures after 2018. Once the discard plan expires, the landing obligation would have to be applied without any exemptions which could have severe negative economic effects in some fisheries (see Table 3.4.2). Additionally, under this option, when stocks fall below a stock size consistent with full reproductive capacity, there would be no immediate safeguards written into the regulation. In the absence of such semi-automatic initiatives to recover the stocks to safe biological levels, stock recovery is normally slow as decision makers avoid drastic measures that lead to large reductions in fishing mortality. 5.2.2.A single mixed-fisheries plan for North Sea demersal fisheries This option would provide one plan, containing one single management framework for the management of stocks caught together in demersal fisheries in the North Sea. It would aim to account for mixed-fisheries interactions through the introduction of FMSY ranges, allowing more flexibility in the setting of fishing opportunities. This would enable more coherence in the definition of fishing opportunities for the different stocks it would cover because different stock's TACs would be able to be based on values of fishing mortality within their FMSY ranges, rather than the point estimate value of FMSY (see Section 3.4.2). A mixed-fisheries plan, using ranges of fishing mortality, instead of point estimates, as MSY targets would maximise the contribution that a mixed-fisheries approach to setting TACs could make to reducing the choke species problem. Figure 5.2.2.1 illustrates for five of the six main North Sea demersal stocks how FMSY ranges help to resolve the choke species problem described in Section 3.4.2. Each of the symbols in the figure shows where the fishing mortality in 2013 is, in relation to FMSY. If the value is less than 1, then the fishing mortality in 2013 (F2013) is higher than the FMSY values. If the value is greater than 1 then the F2013 is lower than the FMSY values. The three different symbols represent F2013 relative to: the point estimate of FMSY (blue diamonds); the upper bound of the FMSY range (red triangles); the lower bound of the FMSY range (green squares). It can be seen that saithe, plaice and sole, for example, have F2013 values that are around FMSY (they all have values of around 1) and similar relative ranges of FMSY for the three species. Conversely, cod and haddock are very different to the other three species. Cod in 2013 is well above its FMSY values, whereas haddock is well below its FMSY values. It would, therefore, be easy to set coherent TACs for saithe, plaice and sole to ensure exploitation consistent with FMSY. However, because the relative FMSY ranges for cod and haddock have minimal overlap with each other and with the ranges for the other species it would be difficult to set TACs that would exploit all five species at levels consistent with FMSY. This is where regionally defined technical measures that would be possible under the framework of a multi-annual plan could be useful to complement the FMSY range approach, for example, by reducing the F for cod through technical measures and thereby minimising choke effects, rather than setting incompatible TACs. An added important dimension, agreed by the Inter-Institutional Task Force6, would be the identification of the species that determine the fishery as opposed to the by-catch species, with distinct management targets for the two categories of stocks – all befitting the MSY objective. For the target species (driving the fishery) the plan would introduce ranges of fishing mortality, while for by-catch species in the fishery it would include specific or alternative conservation measures to ensure that the conservation objectives are respected.

The regionalised governance possibilities under the new CFP (see Section 3.1.3) mean that the plan would not only allow for adaptation mechanisms in specified technical measures to allow for the introduction of measures to decouple fisheries (see above) but also to use such measures to minimise impacts of fishing on the wider marine environment, e.g. on marine mammals, sea birds and the sea bed. Specific technical measures to protect the marine environment might be needed for one fleet, but not necessarily for another. Under this option, it will be possible to adopt such measures rapidly, without having to make use of the lengthy Ordinary Legislative Procedure. By the same token, the plan would allow for the introduction of implementation elements for the landing obligation in light of the limited lifespan of discard plans. Creating a single management framework, with in-built options for Regionalisation and adaptation would allow the plan to be responsive to changes in the fisheries, in the management advice and in the status of the stocks while keeping consistency between all of the elements relevant for the management, and making it easier to ensure coherence across the stocks caught together in the mixed fisheries. Within this option there are a number of choices to be made: the delineation of areas and the consequent fisheries and stocks to be covered the choice of how to introduce measures that facilitate the introduction of the landing obligation the choice of the ranges for FMSY the choice of species for which precise MSY-related target ranges would be set. The Task Force agreement foresees focus on the species that drive the fishery – the main target species – and by managing those sustainably, the plan is expected to deliver on the conservation objectives for the by-catch species as well the latest dates for achieving FMSY (between now and 2020 at the latest) the time period for rebuilding stocks to precautionary levels (whenever they are below such levels) The first four choices can be taken based on a qualitative analysis conducted in the following sub-section. The last two sub-options will be analysed quantitatively. 5.2.2.1.Sub-options for qualitative analysis Delineation of areas When deciding on the area scope of the plan, several criteria have to be taken into account: different multi-annual plans have to be coherent, situations where areas remain uncovered by a plan in the long term should be avoided the area coverage should be as coherent as possible with the areas covered by established Member States' regional cooperation fora (here: the Scheveningen group, see Section 3.1.3) and Advisory Council areas (here : the NSAC, see Section 3.1.3). In case of a mismatch between the area covered by the plan and these bodies, Member States would have to cooperate outside the established regional fora when drafting Joint Recommendations and two or more Advisory Councils would have to be consulted on these measures. fish stocks do not respect the borders drawn by humans; additionally the borders between fish stocks are different. However, as much as coherence as possible in biological and fisheries terms should be achieved. It is obvious that ICES Subarea IV, which is the main part of the North Sea, should be covered by the plan. The question is whether adjacent waters like Skagerrak and Kattegat (Division IIIa) and the Eastern Channel (Division VIId) should be covered by the plan as well. Skagerrak and Kattegat have to be covered by the plan as they are not covered by the Baltic Sea plan which has been proposed by the Commission42. Not including this area into the North Sea plan would lead to a situation where this area would likely remain uncovered in the long-run as it is too small to justify a plan on its own.

STECF30 was requested to comment on the areas to include in the new generation of regional management plans. STECF recommended inclusion of the Eastern Channel within a North Sea plan, as the fish in the Eastern Channel (VIId) appear to have greater affinity with the North Sea than areas to the west. At the same time, however, this area is not covered by the Scheveningen group and the NSAC but by the regional management body called the North-Western High-Level Group and by the North-Western Waters AC (NWWAC). Therefore, it has to be decided whether to follow the criteria of coherence with the area coverage of established management bodies and Advisory Councils or the criteria of biological coherence. It seems appropriate to opt for coherence with the management areas. The reason is that it is not so important where to establish management objectives for fish stocks, e.g. FMSY ranges. What is important is that there are no contradictory objectives for the same stock in different plans. Management objectives should be included in the plan which covers the area of main abundance of a stock. In order to ensure coherence between different plans, all plans would have to ensure that management objectives established in other plans remain valid when a stock straddles the areas of those plans. The Commission can ensure this when establishing and amending plans. Hence, a lack of biological coherence can be remedied. Deviating from the area covered by the Scheveningen group and the NSAC would be more problematic, notably when adopting measures under Regionalisation. As explained, additional Member States and the NWWAC would have to be consulted when formulating Joint Recommendations. This would be detrimental to a smooth implementation of Regionalisation which actually builds on improving cooperation among Member States as well as among stakeholders, so changing the current configuration should be avoided. The sub-option of including the Eastern Channel into the plan is therefore discarded. This area will have to be covered by the North-Western Waters plan which is being developed in parallel. To ensure coherence with the other plans, the Commission has to ensure that if a range of FMSY is to be set for any straddling stock then this range is included in the plan that covers the area of main abundance of the stock in question; all other plans containing that straddling stock will contain a provision that makes the application of the FMSY range also binding in the areas that they cover. In the Public Consultation (Annex I), some stakeholders supported the inclusion of the Eastern Channel into the plan, while some contributions from the fishing industry objected to the inclusion of Skagerrak and Kattegat and the Eastern Channel if this leads to the inclusion of additional stocks other than straddling stocks that are also present in the main basin of the North Sea (Subarea IV). The NSAC in its contribution only highlighted the need of consistency with adjacent areas. Choice of method for facilitating the introduction of the landing obligation As described in Section 3.6, the Basic Regulation allows the adoption of so-called "discard plans" through Regionalisation to adopt exemptions from the landing obligation for not more than three years. After the expiry of these discard plans, exemptions will still be needed, in order to allow for the discarding of species that survive discarding and to allow for exemptions in situations where the landing obligation is a disproportionate measure. The Basic Regulation itself foresees in Article 15(5) that such exemptions should be adopted as parts of a multi-annual plan and "where relevant, further specified in accordance with Article 18", i.e. through Regionalisation. The latter would mean that the multi-annual plan includes an empowerment to adopt delegated acts for this purpose. When drafting a multi-annual plan, the Commission will have to decide which elements of the future exemptions from the Basic Regulation will be included in the multi-annual plan itself and which elements will be adopted as a part of a delegated act / Joint Recommendation. However, the option of including exemptions in the plan itself can be discarded, for several reasons. Firstly, the discard plans that are adopted on the Basic Regulation are constantly evolving. The Scheveningen group has brought forward a first Joint Recommendation concerning demersal North Sea fisheries that only covers the first stage of the landing obligation, i.e. exemptions from the landing obligation for the stocks for which this obligation applies already in 2016. Further Joint Recommendations will follow for the following steps. The multi-annual plan will be adopted before the landing obligation will be fully implemented in the North Sea, thus an empowerment for delegated acts to adopt exemptions for the later steps of the phasing-in of the landing obligation would be needed in order to avoid a situation where the plan has to be amended several times through the Ordinary Legislative Procedure. One could imagine consolidation of all the exemptions already adopted in the plan itself; however, some these exemptions might still evolve as some of them, following STECF evaluation, will probably only be granted under the condition that the Member States conduct further scientific studies that justify these exemptions. The adaptive, flexible approach of Regionalisation is therefore clearly the preferred option for this element of the plan. Choice of the FMSY ranges In terms of the ranges of FMSY to be used in the plan, in September 2014 Commission Services requested ICES to provide plausible values around FMSY (ranges for FMSY) for various stocks of fish and shellfish in the North Sea41, to be based on the stock biology, fishery characteristics and environmental conditions (see also Section 3.1.4). ICES provided FMSY ranges41 (Flower, Fupper) that are derived to deliver no more than a 5% difference in long-term yield compared with FMSY. Additionally, in order to be consistent with the ICES precautionary approach, the value for Fupper is capped, so that the probability of the spawning stock biomass (SSB) being below the limit biomass reference point (Blim) is no more than 5% ( and Figure 5.2.2.2 below). Theoretically, wider (or narrower) ranges could be envisaged. However, for consistency and coherence with the Baltic plan, which has used the ICES definitions for the FMSY ranges, the North Sea plan will also use ICES' definitions. Figure 5.2.2.2. Illustration of biomass-based reference points. Blim and Bpa are precautionary reference points related to the risk of impaired reproductive capacity. Diamonds show the variable recruitment for different spawning stock sizes (SSB) that has been observed over the years. Recruitment can be seen to be generally lower when the SSB is below Blim. In the Public Consultation (Annex I), the NGOs replied that they would like to set the upper bound of the range at the point estimate of FMSY. However, this would effectively set FMSY as a limit not as a target. The current practice is to consider FMSY as a target, which means that the actual fishing mortality would fluctuate around FMSY, sometimes above, sometimes below. Setting FMSY as a limit would mean that we should never fish above that level. The target fishing mortality would, therefore, need to be substantially lower than FMSY. This would lead to underfishing of virtually all stocks in the mixed fishery. Choice of species All harvested species in the North Sea are covered by the obligations and objectives of the Basic Regulation and these same harvested species will be covered by this plan. Where FMSY ranges are available then those species will be listed accordingly. Currently these are the main target species. However, the plan is expected to deliver on the conservation objectives for the by-catch species as well and to evaluate the question of whether management of the species that drive the fisheries adequately allows for the management of the by-catch species, STECF29 carried out an analysis of correlations between the catches of driver species identified in the plan and a variety of by-catch species. The analysis overall suggested limited correlation meaning that, at the gross level, management of the species that drive the fisheries would not be adequate for the management of the by-catch species. However, when the analysis was performed at the fleet segment level, there were some obvious strong correlations between some driver and by-catch species in specific segments but not in others. This suggests the scope to use fleet segment-related management measures for the driver species as a way of managing some of the by-catch species through, for example, technical measures. Under the framework of the multi-annual plan, the regionalised governance will enable these kinds of measures to be introduced at the appropriate regional level to enable the appropriate management of the by-catch species. 5.2.2.2.Sub-options for quantitative analysis Achievement of FMSY Article 2(2) of the Basic Regulation provides for a binding obligation to reach FMSY (see Section 3.4.1) but leaves some flexibility regarding the timeframe for reaching this target (by 2015 where possible and […] at the latest by 2020). In order to achieve the objective of providing a transparent framework regarding FMSY, the plan should specify this timetable for the North Sea demersal stocks. The environmental, economic and social impacts of different timeframes should therefore be assessed.

The time period for rebuilding stocks to precautionary levels Annex 2 of the UN Fish Stocks Agreement contains guidelines for applying a precautionary approach within an MSY framework. In accordance with a precautionary approach, populations need to be maintained within safe biological limits to make MSY possible. However, within safe biological limits, an MSY approach is necessary to achieve MSY. A precautionary approach is a necessary, but not a sufficient condition for MSY. When a stock's biomass falls below safe biological limits then it needs to be rebuilt because when the spawning stock size is estimated to be below safe biological limits, the probability of impaired recruitment is expected to be high66. The time taken to rebuild any stock is associated with the level of risk that managers are prepared to take in attempting to achieve management objectives. It is anticipated that catch opportunities would be set at a fishing mortality rate that is lower than the lower bound of the FMSY range; this is coherent with the Baltic plan proposal. A biomass objective in a plan should be linked to a binding timetable; otherwise rebuilding the stock can be delayed and will not have any binding effect. Theoretically, many different timeframes can be imagined. However, it seems reasonable not to go beyond a recovery time of 10 years, firstly because longer timelines would make the objective irrelevant for the current generation of fishermen and would thus put at risk the support for this policy objective. Secondly, if a stock is below a biomass safeguard threshold, there is a constant risk that the stock might collapse and the stock size shrink to even lower levels. Therefore, the time at which the stock is left in such a risky state has to be limited. Recovery within 5 years seems to be a reasonable choice as an alternative sub-option. As the most important stock that is below Bpa at the moment is cod and as the TAC for this stock has a limiting effect on fishing for other stocks, a faster recovery time would imply a stronger reduction of the TAC and thus have more negative economic and social consequences. 6.Analysis of impacts The main areas of uncertainty in the short-term are around the introduction of both the landing obligation and Regionalisation, introducing the new concept of results-based management, as noted in Sections 3.1.3 and 3.4.2. This uncertainty has a knock-on effect for the evaluation of the impacts of the candidate options, as by nature these impacts will be very difficult to quantify. It is impossible at this stage to know what Joint Recommendations the Member States may put forward for technical and other conservation measures etc. and their subsequent impacts, and the landing obligation will be introduce on a stepwise basis, introducing more stringent, but currently unknown, exemptions each year. As a result, the approach used here has been to give the best evaluation of the possible impacts of each option, taking into account the introduction of the landing obligation in the new CFP. The impacts are considered in the light of various indicators which are: Environment: abundance of the main stocks (SSB; risk to Blim; risk to Bpa66) Economic: landed value; profitability and revenue Social: employment; number of vessels. 6.1.Option 1- Use the Basic Regulation (including the landing obligation) This option can be considered as a realistic baseline scenario in the sense that existing plans have lost most of their value in light of the MSY objective under the new CFP (see Section 5.1.1). Description of the option and stakeholder support Under this option the current management plans are repealed and the new Basic Regulation (including the landing obligation) is applied (see Sections 3.4 and 5.2.1). This option is the baseline against which any added value of the mixed-fisheries multi-annual plan can be ascertained. The large majority of stakeholders call for repealing the current cod plan, which is seen as rigid and overly restrictive. Generally, however, stakeholders are expecting a strategic multi-annual framework that is provided by a new generation of plans, containing ranges of FMSY, rather than a reversion to the unpopular situation (before the plans) whereby TACs are set purely on an annual basis, without guidance and only steering on MSY. The high expectations from EU Institutions, Member States' authorities and stakeholders for a multi-annual plan imply that this option would only be acceptable when a multi-annual plan would have no clear, demonstrable added value. Additionally, repealing a plan without replacing it is considered not to be in line with the objectives of the CFP (i.e. to bring more stocks under multi-annual management plans). Additionally, this approach would mean that the European Parliament would not be involved in the decision making. The majority of the important fish species in the North Sea demersal fishery have already achieved, or are close to achieving FMSY. Cod, however, is still being exploited above FMSY. The information available at the time of the consultation and scientific analysis was that cod was fished in 2014 at a fishing mortality of F=0.4. The impact of achieving FMSY will, therefore, mostly be driven by the rate at which the fishing mortality for cod is reduced from 0.4 to FMSY. The following impacts will be described with the assumption that fishing mortality on cod is reduced from F=0.4 in 2014 to the point estimate of FMSY for cod, where F=0.22, at the start of 2016. Table 3.4.2 in Section 3.4.2 above, describing the evolution of the problem with full implementation of the landing obligation, illustrates the effects that cod can have on the under exploitation of other species in the North Sea demersal fisheries. The single species scientific advice for cod in 2015 given in Table 3.4.2, and also in Table 6.1 below, shows the landings that would be obtained if the North Sea cod stock was fished at FMSY in 2015. Table 3.4.2 illustrates the impact of the choke effect that cod would exert on the landings of other stocks in the North Sea mixed-fisheries assemblage; it also shows the subsequent impact on the value of those landings. Table 6.1 illustrates the impact of the reduction in catch on the size of the stock (SSB) the following year. The tables are highly illustrative of the scale of the impact of an immediate change to FMSY for cod.

Table 6.1. The effects on landings and SSB, in tonnes, for six North Sea demersal fish species based on the mixed-fisheries advice for 201553 where, once the North Sea cod quota is caught, other fisheries catching cod would have to cease fishing. Species Single species landings advice 2015 (t) Landings (t) if landing obligation fully applied SSB (t) 2016 following single species advice SSB (t) 2016 following full LO on cod % difference in SSB Cod 26713 26713 109100 104855 -4 Haddock 48176 16592 117426 146776 25 Plaice 128376 60175 735259 803339 9 Saithe 72854 45797 178867 210160 17 Sole 10973 6469 53783 58524 9 Whiting 17190 9654 266012 270986 2 6.1.1.Environmental effects The landings of cod would be significantly reduced if FMSY is achieved at the start of 2016, from around 40 000 t to 26 713 t. The choke effect that this would exert on the other stocks in the North Sea mixed-fisheries assemblage would result in significantly reduced catches of the other fish species. The knock-on effect of this would be positive for the stock size of all of the species because less fish would be removed in the fisheries, leaving larger stocks in the sea. However, the short term impact on SSB is small compared to larger long-term effects where leaving higher biomasses reduces the risks to any of the stocks falling below Bpa and Blim. The MSY approach is intended to make the best use of the ecosystem productivity in the long term. Therefore, in the long term, once MSY is achieved, the SSB for each stock would be expected to fluctuate around its maximum. All of the stocks have some way to go to achieve their maxima. 6.1.2.Economic effects The converse effect is true for the economic effects on the North Sea industry. Table 3.4.2 shows that the large reduction in catch opportunities resulti