Explanatory Memorandum to COM(2011)416 - Common organisation of the markets in fishery and aquaculture products - Main contents
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| dossier | COM(2011)416 - Common organisation of the markets in fishery and aquaculture products. |
|---|---|
| source | COM(2011)416  |
| date | 13-07-2011 |
A Common Market Organisation (CMO) for fisheries and aquaculture products has been in place since 1970. It is one of the pillars of the Common Fisheries Policy (CFP). Its current legal basis is Regulation 104/2000, adopted in 1999. The reform of the Common Fisheries Policy provides an excellent opportunity to review and possibly revise objectives and instruments of the Common Market Organisation for fisheries and aquaculture products.
Since 2008 the Commission has been carrying out extensive evaluations and consultations to assess the performance of the current legal framework, to take stock and analyse market developments and trends in the EU in the last decade and to hear the views of the parties concerned.
Analyses led to identify five main problem areas found, which may be summarized as follows.
EU Common Market Organisation did not sufficiently contribute to sustainable production: while many EU fisheries are not exploited in a sustainable way, until recently, there were very limited market premiums for sustainable practices or no market sanctions for potential or real unsustainable practices. The current policy has insufficiently provided the right policy signals.
the market position of EU production has worsened: EU producers are facing limited or decreased production opportunities (fisheries and aquaculture). In addition the production side is fragmented due to the number of species, landing and selling sites, whereas the demand side is strongly concentrated. EU production also lacks competitiveness in an increasingly globalised market.
we have been unable to anticipate or manage market fluctuations: Fishing, more than other food production sector, is characterised by uncertainty with regard to production conditions and access. Nevertheless EU supply lacks predictability in terms of volume and quality requested by the demand side. Conversely EU producers to a large extent do not anticipate market demand in their production planning. This leads to a high volatility of first sale prices.
our market potential is largely untapped: increasing consumption throughout the EU offers tangible economic opportunities for EU producers. But information and transactions costs are high along the marketing chain. From a consumer perspective, limited information provided do not allow to make an informed and responsible choice.
implementation of the Common Market Organisation is being held down by a cumbersome, overly complex framework.
In this context the proposal for a reform of the Common Market Organisation focuses on the following objectives:
Upgrading market incentives to support sustainable production practices: EU producers (fisheries and aquaculture) within Producers Organisations are on the coal face of production, day to day resource management and market issues. Their role, responsibility and mandate need to be reviewed in line with the objectives of the reform of the CFP in order to direct production activities towards sustainability. Other operators upstream in the sector should also be targeted so as to become more committed and responsible for sustainability of their sourcing.
Improving the market position of EU production: Addressing market imperfections, high information and transaction costs, as well as organisational matters, leads to focus on production activities (grouping supply and better marketing at first sale), increase competitiveness of EU production (quality, innovation and added value), reinforce bargaining power of producers and ensure level playing field conditions for all products marketed in the Union.
Improving the connection between EU production and EU structural market changes and short term fluctuations should be better reflected in producers’ strategies. This supports the development of market knowledge and analysis on the demand side and on competing supplies. Increasing transparency along the marketing chain of markets should facilitate supply meeting demand and enhance policy decision making. The volatility of first sale prices can be reduced by improving conditions for placing POs’ products on the market and by ensuring that production is planned and adjusted to demand in terms of quality, quantity and presentation.
Enhancing the market potential of EU products: The functioning of the internal market for fisheries and aquaculture products is suboptimal in particular due to information failure. The comparative advantages of EU production (freshness, local, variety etc.) could be better exploited with more differentiation and merchandising. In addition EU consumers have the right to be informed with more precise and reliable information to reinforce confidence in fishery and aquaculture products.
Supporting better governance, reduction of administrative burden and simplification of the legal framework: The existing provisions and instruments should be reviewed, simplified and clarified. The Common Market Organisation should be supported in the context of a new financial fund to be implemented within the reformed CFP.
The main objective of the reform of the Common Fishery Policy is promoting the sustainable management of fishery resources through an economically viable sector, which in turn is to be increasingly empowered with its own management. The CFP impact assessment concluded that, considering the new objectives and instruments of the CFP, a far-reaching reform of the Common Market Organisation was necessary: market-oriented instruments should contribute, directly or indirectly, to meeting the main CFP objectives.
To address overfishing and unsustainable practices and move away from production strategies based solely on volume, the new Common Market Organisation will support:
the empowerment of producers organisations and their co-management of access rights as well as production and marketing activities;
market measures that increase the bargaining power of producers (in fisheries and aquaculture) improve prediction, prevention and management of market crisis and foster market transparency and efficiency;
market incentives and premiums for sustainable practices; partnerships for sustainable production, sourcing and consumption; certification (ecolabels), promotion, information to consumers;
additional market measures on discards.
Council Regulation (EC) No 104/2000 establishing a Common Market Organisation in fisheries and aquaculture products is the current regulatory framework. This proposal is aimed to replace this Regulation.
Contents
- RESULTS OF CONSULTATIONS WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENTS
- LEGAL ELEMENTS OF THE PROPOSAL
- Problems identified and objectives for the reform
- Interaction with the reform of the CFP
- Existing EU provisions in this area
- Impact assessments
- Legal basis
- Subsidiarity principle
- Proportionality principle
Consultations with stakeholders have been carried out at various levels since 2008:
Internet-based public consultation on market and trade issues which took place from 9th April 2009 to 31st December 2009 in the framework of the Green Paper for the reform of the Common Fisheries Policy (COM(2009)163 final). Almost all of the 400 contributions received on the Green Paper addressed issues related to a reform of the Common Market Organisation. This is summarised in a specific chapter (3.4) in the Commission Staff Working Document on “Synthesis of the Consultation on the reform of the Common Fisheries Policy” SEC(2010)428 final - April 2010.
Wide consultation of the sector (producers, importers, processors, retailers) and of non-governmental actors (development and environmental NGOs, consumers’ organisations) within the consultative bodies in place under the CFP and thematic seminars. Extensive dialogue with Member States including bilateral meetings took place with national representatives from the sector, the national and regional administration, and the Management Committee. The European Parliament, in particular the Committee of Fisheries, has been closely associated with these consultations and events.
An interservice steering group was created within the Commission and provided inputs during the impact assessment process. An analysis of the current policy framework and EU market development for fisheries and aquaculture products was followed by identification of preliminary objectives for a reformed Common Market Organisation. Under these objectives different policy alternatives options for the reform have been considered:
Continuing the current Common Market Organisation for fisheries and aquaculture products. This means that focusing mainly on market interventions to support price stability.
Revising the current Common Market Organisation for fisheries and aquaculture products by reducing intervention mechanisms to a single storage aid for fishery products destined for human consumption and making other instruments more simple, appropriate and flexible (marketing standards and information to consumers).
Enhancing the Common Market Organisation for fisheries and aquaculture products by empowering Producers Organisations and Inter-Branch Organisations with new objectives and granting them financial support to draw and implement sustainable production and marketing plans. The content and scope of mandatory consumer information are extended. Accuracy and control of voluntary labelling are considered.
Deregulating the current Common Market Organisation for fisheries and aquaculture products. This option suppresses all financial support (intervention and support to collective actions) and any specific legal instrument for fisheries and aquaculture products.
Status quo option was evaluated partly inefficient and too complex to fulfil its current objectives. Today, 12 years after its adoption, the current CMO appears unfit for the challenges of the EU market. It will result even more ineffective and possibly inconsistent with the objectives of the reformed CFP.
Correcting the main shortcomings of the existing CMO by proposing adjustments and simplifications would improve its functioning. The relevance to the main objectives of the CFP reform would however remain limited.
Remove the EU Common Market Organisation altogether, even considering that market-driven developments and incentives toward sustainability have increased, would not fully addressed the main problems identified, namely the complex and fragmented EU supply sector and the risks of misleading or confused consumer information.
Therefore the Commission supports to enhance the Common Market Organisation so as to accompany the fisheries and aquaculture sector while it shifts toward sustainable production practices. Much can be done in terms of organisation and marketing to increase predictability of supply and reduce transactions costs. This option emphasises the role of each main stakeholder in favouring sustainable practices. The Common Market Organisation should help increase the added value of fisheries and aquaculture products in a context where financial support is moved away from the fleet (especially scrapping and temporary cessation), in favour of smart, green, innovative and market-oriented solutions for the fisheries and aquaculture sector.
Article 43(2) of the Treaty on the Functioning of the European Union.
The proposal falls under shared competence, and the subsidiarity principle therefore applies.
The proposal complies with the principle of proportionality for the following reason:
The Common Fisheries Policy is a common policy and should therefore be implemented through a Regulation adopted by the European Parliament and the Council. It is necessary and appropriate for the achievement of the basic objective of ensuring fishing and aquaculture industries that provide long-term sustainable economic, environmental and social conditions and contribute to the availability of food supplies, to lay down rules on the conservation and exploitation of marine biological resources. This Regulation does not go beyond what is necessary to achieve that objective.