Opinion of the Committee of the Regions on the 'Proposal for a Council Regulation (EC) on Structural measures in the fisheries sector'
Date: 1999-01-14
Institutions: European Committee of the Regions
Subjects: EAGGF Guarantee Section, FIFG, fishing fleet, fishing industry, industrial restructuring, regional aid

C 93/16

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Official Journal of the European Communities

6.4.1999

Opinion of the Committee of the Regions on the ‘Proposal for a Council Regulation (EC) on
Structural measures in the fisheries sector’

THE COMMITTEE OF THE REGIONS,

(1999/C 93/03)

having regard to the Communication from the Commission to the Council, the European
Parliament, the Economic and Social Committee and the Committee of the Regions on Agenda
2000: the legislative proposals — Overall view;

having regard to the Proposal for a Council Regulation (EC) on structural measures in the
fisheries sector [COM(1998) 131 final — 98/0116 (CNS)] (1);

having regard to the Commission decision of 18 March 1998, in accordance with the first
paragraph of Article 198c of the Treaty establishing the European Community, to consult the
Committee on the subject;

having regard to the Bureau Decision of 13 May 1998 to instruct Commission 2: Agriculture,
Rural Development and Fisheries to draw up the relevant opinion;

having regard to its Opinions on the regional consequences of the Common Fisheries Policy
(CdR 14/96) (2), and on the Common Fisheries Policy: safeguarding of fisheries-dependent
regions (CdR 179/97 fin) (3);

having regard to the Draft Opinion (CdR 309/98 rev. 2) adopted by Commission 2 on
10 December 1998 (Rapporteurs: Sir Simon Day and Mr Nordwall),

at its 27th plenary session on 13 and 14 January 1999 (meeting of 14 January) adopted the
following opinion.

1.

Introduction

1.1.
In July 1997, the Commission adopted Agenda
2000, a blueprint for the future proposals and budgeting
implications for the expansion of the EU, the reform of
the CAP and a review of regional policy.

1.2. On 18 March 1998, the Commission adopted its
proposals for regulations,
inter alia, to govern the
Structural Funds in the period 2000-2006. These are the
subject of negotiation with Member States and are the
subject of consultation with the Committee of the
Regions.

2. The Current Position

2.1.
Under the existing Structural Funds regime, there
is a specific Objective (Objective 5a) whose purpose is
to speed up the adjustment of agricultural and fisheries
structures. It does not have a geographical limitation as,
for example, Objective 5b. The source of funding for
Objective 5a is derived in part from the Financial
Instrument for Fisheries Guidance (FIFG).

(1) OJ C 176, 9.6.1998, p. 44.
(2) OJ C 129, 2.5.1996, p. 1.
(3) OJ C 379, 15.12.1997, p. 1.

2.2.
FIFG covers the whole of the fisheries sector
and funding can be used for such activities as fleet
modernization, decommissioning, the development of
aquaculture, the protection of marine coastal areas, the
provision of fishing port infrastructure, fish processing
and marketing, product promotion, and grants to
fishermen leaving the sector.

2.3.
Some Objective 1, 2 and 5b areas have been
designated on the basis of dependency on fishing. These
areas are eligible for ERDF and ESF assistance for
business and tourism support and infrastructure, com-
munity economic development and training for
employees of SMEs and people in deprived communities.
ESF is also available to these areas from Objectives 3
and 4 which are not geographically restricted and fund
training and skills development.

2.4.
There is also a Community Initiative, called
Pesca, which is intended to complement activities under
the regional Objectives, but is more geographically
limited. Pesca funding is focused on addressing the
socio-economic difficulties faced by fishing dependent
area, and draws resources from ERDF, ESF and FIFG.
It is intended to encourage a more local initiative led
programme – and in this respect is similar to Leader.

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3. The Proposed Regulation

3.1.
The reform of the Structural Funds post 2000
envisages just three Objectives. In broad terms Objective
1 stays very much as now, covering assistance to the
most disadvantaged areas. The new Objective 2 provides
support for development in areas experiencing decline
and structural change and will comprise 4 strands,
industrial, rural, urban and fishing, whilst the new
Objective 3 will cover activities funded under the old
Objectives 3 and 4.

3.2.
Community Initiatives are being simplified and
a specific Pesca Community Initiative is not included
although it is intended to include Pesca-type activities
within the new framework of assistance.

3.3.
For the fisheries sector as a whole, it is intended
that structural assistance for the period 2000-2006 will
be much the same as in 1994-1999. The fishing industry
and coastal areas located in Objective 1 regions will
continue to receive assistance not only from FIFG but
also ERDF and ESF.

3.4.
The new Objective 2, fishing strand, will apply
to the areas dependent on fisheries which are undergoing
economic and social restructuring. The areas included
will be selected by Member States on just two criteria:

proposes that, because FIFG under Objective 2 is to be
exclusively regional, it cannot be used to cover measures
programmed at a national level, such as the restructuring
of fishing fleets. So it proposes that this form of
assistance is brought into the Guarantee Section of the
European Agricultural Guidance and Guarantee Fund,
which is where the programme is developed at a national
level.

3.8.
Thus FIFG will assist all schemes in the regions
covered by the new Objective 1, including those affecting
the fishing fleet, and will also fund structural measures
in the Objective 2 areas, except those involving the fleet.

3.9.
The EAGGF Guarantee Section will fund fleet
restructuring outside Objective 1 regions and schemes
involving the fishing industry apart from in areas covered
by Objectives 1 and 2. The EAGGF will also fund
structural measures during the transitional period high-
lighted earlier.

Although the Pesca initiative is not being carried
3.10.
forward, many of the activities undertaken under Pesca
are proposed for inclusion in the new Objective 2.

(i)

the share of employment in the fishing industry in
total employment;

4. Conclusion

(ii) the loss of jobs in the industry as a result of

restructuring.

Within these geographically defined areas, assistance to
fishing areas would be obtained through ERDF, ESF
and FIFG.

3.5.
The Committee of the Regions wishes to be
satisfied at the extent and nature of assistance there is
for regions which were formerly within Objective 1, 2
or 5b and which are no longer and the assistance for
regions that are outside the new Objective 1 and 2 areas.

3.6. Within the former Objective 1, 2 or 5b areas,
there are transitional arrangements proposed such that
assistance, albeit at a reduced level, will continue to be
available for 6 years, in the case of former Objective 1
areas, and for 4 years in respect of former Objective 2
and 5b areas. The Committee of the Regions in its
response to the draft regulations argues that there should
be equal treatment in all areas in terms of the transitional
period.

4.1.
The European Commission intends continuity
of assistance. It has been anxious to ensure that by
simplifying the number of Objectives (and the number
of Community Initiatives), the fisheries sector is not
adversely affected. The use of the nationally based
EAGGF programme is its preferred way of ensuring that
that the fisheries sector outside the new geographically
defined areas continues to get assistance. Nevertheless,
it is not the intention that the EU co-finance the
same measure under two different financial instruments
depending on the region concerned, as happens with the
fleet restructuring measures financed by the FIFG in
Objective 1 areas and by the EAGGF Guarantee in
Objective 2 areas. Hence the FIFG should also participate
in co-financing the fleet restructuring measures in
Objective 2 regions.

4.2. However, whilst simplification is intended over-
all, for the fisheries sector, the regulation brings more
complexity, since there would be 4 different mechanisms
for getting support, in some cases all operating in one
region:

— FIFG: everything in Objective 1 areas;

In terms of assistance to the fisheries sector
3.7.
outside the new Objective 1 and 2 areas, the Commission

— FIFG: structural measures in Objective 2 areas;

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— EAGGF: fleet restructuring in non Objective 1 areas;

— EAGGF: structural measures (undefined) in non

Objective 1 and 2 areas.

The first two would be managed regionally, the latter
two, nationally. It is difficult to see how this will be
managed coherently and transparently and conflicts
with the ‘one region — one strategic plan’ for all funds
and objectives which is being recommended for many
regions. We believe that wherever practicable, funding
should be administered on a regional basis and not a
national basis, since we do not share the Commission’s
view that it is impossible to regionalize fleet restructuring
measures. In the interests of transparency and efficiency,
fleet restructuring and compliance with the MAGPs
should be programmed on a regional basis since it would
not seem consistent for programming to be at national
level and financial administration at regional level. To
this end, regionalization along the lines of the FIFG
programme, setting up proper machinery for transfers
between regions and making the regions responsible for
compliance, would ensure that the national objective
was attained.

4.3.
The European Commission has yet to determine
the structural measures (other than fleet restructuring)
to be available under the EAGGF in non Objective 1
and 2 areas. The draft regulation was due to be tabled
in September and was still not available at the time this
Opinion was drafted. It is important that the Committee
of the Regions is consulted on this new regulation.

4.6.
It is important to recognize that meeting the
requirements of MAGP IV requires decommissioning or
a reduction of fishing effort or a combination of both.
In order not to worsen the employment situation, it
would be opportune and advisable to give financial aid
to regions concerned by decommissioning or by a
reduction in fishing effort, so that they can reinvest in
other activities. For example, such funding should
be made available to reinvest the human resources
withdrawn from fishing in complementary activities
such as the processing and marketing of fishery and
aquaculture products. We believe it is important to
restore the compensation provisions, which applied in
an earlier MAGP such that payments for laying up boats
on a temporary basis (in effect a set-aside payment) are
made. These need to be included in the regulations. We
also believe that the requirement in MAGP III to require
a minimum of 55 % of the target to be achieved through
decommissioning and a maximum of 45 % through a
reduction in fishing effort be restored.

4.7.
It is important that as much help as possible is
given to the fishing industry, to help it adapt to change.
For example, we would like to see included, in the
structural measures, provision for diversification, which
is not available currently outside the current Objective
1, 2 and 5b areas. Also excluded from the FIFG
regulations are public sector aquaculture projects.
Matched funding from public sector sources towards
schemes to allocate part of an estuary in which to train
ex-fishermen in aquaculture are currently disallowed,
whereas privately promoted aquaculture projects can be
funded. There are areas which have fishing and fishing
related activities but which are not necessarily inter-
preted as being fishing dependent. This is unnecessarily
discriminatory and does not assist the EU and the
fishermen in achieving the main goal — a balance
between fishery resources and their exploitation, to
achieve a sustainable fishing industry.

For example, it is important that fishing ports
4.4.
outside the definition of the new Objective 1 and 2
regions are covered by the new structural measures
under EAGGF and that these include assistance in terms
of economic diversification and all the other activities
previously outlined which FIFG currently covers.

4.8.
The Committee is aware that it is mainly a
question of determining how a sector which employs
more than 300 000 people in Europe is to be kept going.

4.5.
Thus unless a fishing area can qualify for
assistance under Objectives 1 or 2, or unless it is included
in the new structural measures, yet to be announced, it
will get no help on aquaculture, fishing port facilities,
product processing and marketing, product promotion
to name but a few. The only assistance which the draft
regulation provides nationally, other than training and
skills development under ESF, will be for fleet restructur-
ing to meet the requirements of the Multi-Annual
Guidance Programmes.

It is aware that the fisheries sector is a highly family-based
and traditional sector, which must be further developed
in market terms.

Extra thought should be given to the further development
of vertical integration, given the imbalance between the
various players on the market and especially between
family businesses and the retail chains.

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4.9.
The Committee thinks that as a result of the
greater scale in the market for fisheries products, the
managers of fish auctions in the various regions of
Europe must consider the various possibilities for
privatization and above all cooperation.

The latter is especially important because it would seem
that in the near future there is bound to be some merging
of the more than 500 auctions in Europe.

The Committee thinks that there is a case for discussing
the payment of financial aid by the European Com-
mission or other bodies to support initiatives in this
direction.

4.10.
The Committee recognizes the importance of
the need to use more technological innovations on board
vessels. Financial support from (regional) authorities for
the acquisition of maritime electronics must not be ruled
out in advance. This will involve energy distribution
systems, engine management and operating systems and
the like. In addition, the development of quality criteria
for various fish species must be promoted in order to
make tele-auctioning possible in the near future.

5. Recommendations:

The Committee of the Regions recommends that the
draft Regulation is amended as follows:

1) Access to funding must be made as simple as possible.

2) Instead of the complexity of funds proposed, there
should be a single fund for nationally administered
schemes and a separate fund for regionally adminis-
tered schemes.)

Brussels, 14 January 1999.

3) With regard to the restructuring of the fleet, which
is closely linked to the fisheries sector, the COR does
not share the view that it is impossible to regionalize
such restructuring measures; these measures should
be regionalized and financed by the FIFG.

4) In terms of fleet restructuring, in addition to compen-
sation payments
for decommissioning, where
reduction of fishing effort is pursued, compensation
payments should be made for temporary laying up
of boats.

5) The requirement in MAGP III to require a minimum
of 55 % of the target reductions to be achieved
through decommissioning and a maximum of 45 %
through a reduction in fishing effort be restored.

6) There should be no geographical

limitations to
support for the fishing industry. If a fishing port, of
whatever size, is outside the new Objective 1 and 2
areas, it should be eligible for assistance — all the
more so if it is small and in a state of crisis.

7) There should be a wide interpretation of diversifi-
cation to meet the four stated primary goals of the
Common Fisheries Policy and matched funding
should be drawn from either public or private sector
sources to achieve this.

8) That the fishing industry, along with agriculture, is
recognized as a major primary industry within the
EU and that the level of funding made available is
commensurate with its importance bearing in mind
that in certain coastal areas of Europe fishing is the
only source of wealth and local productive strength
is based upon it.

9) In future, the criteria for providing aid to the fisheries
sector should pay still greater attention to sustainable
development considerations. However, this should
be achieved in a way which is practicable from
an aid-policy standpoint and does not complicate
administrative costs.

The President

of the Committee of the Regions

Manfred DAMMEYER