In addition to GATT, the other relevant WTO agreements on seafood trade are the
Agreement on the Application of Sanitary and Phytosanitary Measures, Agreement
on Technical Barriers to Trade, Agreement on Implementation of Article VI of
GATT, Agreement on Import Licensing Procedures, Agreement on Safeguards,
and Agreement on Trade-related Aspects of Intellectual Property.
57 Even though
there have been no legal disputes pertaining to the market-related measures on IUU
fishing, the debates on the legality of unilateral trade measures to address environmental challenges had occurred much earlier following some trade disputes in the
WTO.
58
Becker and Stiegler explained that “a risk-neutral individual will commit an
offence if and only if his private expected benefit exceeds the expected sanction
for doing so.”
59 Therefore, the measures to curb IUU fishing should be able to
increase the costs of IUU activity while at the same time reducing the expected
economic benefits. This chapter will identify relevant market-based measures based
on the incentives of doing IUU fishing in Indonesia. It is argued that in addition to
economic punishments to the individual IUU vessels, regulatory measures that
would affect how individual flag states control their vessels, thus the beneficial
owners of the IUU vessels, are also necessary.
There is no definitive list of what can be considered as trade measures in the
context of seafood trade. The IPOA-IUU uses the terms ‘market-related measures’
and ‘trade-related measures’ interchangeably. They can be in the form of catch
documentation or certification schemes or other measures that could prevent IUU
fish or fish products from being traded or imported into a state’s territory. To
determine which trade measures to use depends on the role and interests that
Indonesia has: a coastal state or a flag state. As a coastal state, Indonesia has the
interests to manage and conserve its waters from non-compliant vessels, either
vessels flying Indonesian flag or foreign flag. Here, even though Indonesia does
not have the same market power as the EU which is the largest seafood importer in
the world,
60 Indonesia can still capitalise on the EU power to ensure compliance of
foreign vessels. In the end, those IUU vessels have to land their catch somewhere,
and there is a big possibility that they will target the EU market. Given that the EU is
working very actively to prevent access of IUU fish and fish products to the EU
market since the enactment of the EU Regulation to Prevent, Deter and Eliminate
IUU Fishing [EU-IUU Regulation],
61 foreign fishing vessels wishing to enter the EU
market will have to think twice before extracting fish illegally in Indonesia. Whereas
57 Palma et al. (2010), p. 177.
58 See Young (2014), pp. 302–317.
59 Gallic and Cox (2006), p. 690.
60 Spain, France, Germany, Italy and Sweden are the five EU member States, which are in the top ten
importers of fish and fishery products. Their combined imports make EU the largest market for fish
imports (See FAO 2018, p. 55).
61 See EC Regulation No. 1005/2008 and EC Regulation No. 1010/2009.
7 Market-Based Measures Against Illegal, Unreported and Unregulated Fishing in. . .
129
Agreement on the Application of Sanitary and Phytosanitary Measures, Agreement
on Technical Barriers to Trade, Agreement on Implementation of Article VI of
GATT, Agreement on Import Licensing Procedures, Agreement on Safeguards,
and Agreement on Trade-related Aspects of Intellectual Property.
57 Even though
there have been no legal disputes pertaining to the market-related measures on IUU
fishing, the debates on the legality of unilateral trade measures to address environmental challenges had occurred much earlier following some trade disputes in the
WTO.
58
Becker and Stiegler explained that “a risk-neutral individual will commit an
offence if and only if his private expected benefit exceeds the expected sanction
for doing so.”
59 Therefore, the measures to curb IUU fishing should be able to
increase the costs of IUU activity while at the same time reducing the expected
economic benefits. This chapter will identify relevant market-based measures based
on the incentives of doing IUU fishing in Indonesia. It is argued that in addition to
economic punishments to the individual IUU vessels, regulatory measures that
would affect how individual flag states control their vessels, thus the beneficial
owners of the IUU vessels, are also necessary.
There is no definitive list of what can be considered as trade measures in the
context of seafood trade. The IPOA-IUU uses the terms ‘market-related measures’
and ‘trade-related measures’ interchangeably. They can be in the form of catch
documentation or certification schemes or other measures that could prevent IUU
fish or fish products from being traded or imported into a state’s territory. To
determine which trade measures to use depends on the role and interests that
Indonesia has: a coastal state or a flag state. As a coastal state, Indonesia has the
interests to manage and conserve its waters from non-compliant vessels, either
vessels flying Indonesian flag or foreign flag. Here, even though Indonesia does
not have the same market power as the EU which is the largest seafood importer in
the world,
60 Indonesia can still capitalise on the EU power to ensure compliance of
foreign vessels. In the end, those IUU vessels have to land their catch somewhere,
and there is a big possibility that they will target the EU market. Given that the EU is
working very actively to prevent access of IUU fish and fish products to the EU
market since the enactment of the EU Regulation to Prevent, Deter and Eliminate
IUU Fishing [EU-IUU Regulation],
61 foreign fishing vessels wishing to enter the EU
market will have to think twice before extracting fish illegally in Indonesia. Whereas
57 Palma et al. (2010), p. 177.
58 See Young (2014), pp. 302–317.
59 Gallic and Cox (2006), p. 690.
60 Spain, France, Germany, Italy and Sweden are the five EU member States, which are in the top ten
importers of fish and fishery products. Their combined imports make EU the largest market for fish
imports (See FAO 2018, p. 55).
61 See EC Regulation No. 1005/2008 and EC Regulation No. 1010/2009.
7 Market-Based Measures Against Illegal, Unreported and Unregulated Fishing in. . .
129