Monday, March 16, 2020

The Hake Inshore Trawl Sector: What You Need To Do Now

If ever an appellate authority remained committed to repeating a comedy of errors, the Minister of Fisheries' repeated unlawful and irregular decision-making processes in the hake inshore trawl and sole fishing sectors are cases in point. Bad decisions in law and fact were made repeatedly since July 2017. The comedic errors are of course far from funny. These bad decisions simply annihilate any confidence left in the beleaguered fisheries regulator. They harm legitimate private capital interest in the sector. Instead, what we do see is an increase in illicit capital looking at ways to launder their cash and bribe their way to fishing rights. 

These bad decisions have a profound negative impact on right holders trying to keep people employed and ensuring investments return a decent income. 

The question is, given these multiple unlawful decisions, a multiplicity of review applications and adverse orders against the Fisheries Minister (the only hake inshore trawl fishery decision that was ever successfully defended was the DDG's December 2016 decision which was unsuccessfully challenged by Viking Fishing), where does this leave right holders and appellants in this sector

In simple terms, the Western Cape High Court order of 1 August 2019 effectively takes us back to the moment immediately before the Minister took his first unlawful appeal decision in the Hake inshore trawl fishery in July 2017. Accordingly, at that time the fishery had -

  • 14 Category A right holders (Viking Fishing's right was subsequently purchased and transferred to Seavuna Fishing Co (Pty) Ltd); 
  • 6 Category B new entrant right holders; and
  • 6 Category C new entrant right holders.
Those new entrant appellants who secured fishing rights subsequent to the December 2018 appeal decision have lost their fishing rights. They are merely new entrant appellants whose appeal for rights must now be considered afresh by a new minister in terms of a fresh appeals process which is limited to considering the appeals filed by new entrant appellants only.

The Minister may not interfere with the appeals decided with respect to the Category A right holder group. She may also not interfere with the 70% portion of the hake inshore trawl TAC that was set aside and allocated to these existing right holders. 

The Minister may only consider the appeals filed by new entrant appellants in 2017. In addition, Minister Creecy has now correctly called for appellants to supplement their appeals before she finally decides these. 

What should New Entrant appellants do? Obviously, given the passage of time since these entities had filed their appeals in 2017, they ought to supplement their appeals given changes in their financial and economic circumstances, including the vastly different global economic and trade circumstances we presently face. 

Can the Minister allocate more fishing rights to new entrants? The Minister is entitled to allocate additional rights (As the previous minister had) but Minister Creecy has the unique benefit of hindsight given that she can factually determine whether allocating additional fishing rights to new entrants will actually result in job creation, additional economic activity and actual utilisation of the right by these new entrants. 

Can the Minister change the quantum allocation formula? Yes, Minister Creecy can adjust the quantum allocation methodology provided that she does so with respect to the 30% TAC she has available for the new entrant category group only. She cannot amend the allocation of quantum to the Category A right holder group. 

By when must the supplemented appeals by new entrants be filed? Deadline would be 16h00 on Wednesday 25 March 2020. 



Sunday, March 15, 2020

The Arnie Bengis Money: Where's the Cash?

On 19 February 2020, the National Prosecuting Authority addressed correspondence to the Fisheries Branch seeking urgent clarification as to whether the Fisheries Branch has - 

1. Ringfenced the US$7.45 million (±R111 million) that were repatriated by the Government of Jersey (United Kingdom) for the purpose of investing the monies for the singular objective of recovering depleted fish stocks, particularly West Coast rock lobster; and

2. Established the required Marine Living Resources Fund sub-accounts into which the repatriated funds would be transferred; and

3. Established the Project Implementation Committee, responsible for overseeing the implementation of the marine living resources recovery projects which would be funded by the "Bengis Funds". 

The NPA reminded the Fisheries Branch that it has been more than 6 months since the Jersey Government had transferred these funds and the Governments of Jersey and the United States require an update as to whether South Africa has adhered to its undertakings. The NPA - clearly frustrated by the Fisheries Department's refusal to respond and confirm adherence with its international undertakings - specifically recorded that "the undertakings and commitments we make to our counterparts in the context of Asset Recovery forms the bedrock of our Mutual Co-operation in such matters. Consequently, compliance with such undertakings cannot be taken lightly."

There are a couple of questions that arise. 
  • Firstly, why has the Fisheries Branch refused to respond to the NPA? 
  • Secondly, has the Fisheries Branch implemented any of the undertakings given to the Governments of the US and Jersey? 
  • And why did the DG of Agriculture, Forestry and Fisheries at the time, Mike Mlengana, accuse the DDG of the Fisheries Branch at the time of misappropriating these funds when he knew that the funds were not even in the Marine Living Resources Fund? 
  • What is the Fisheries Branch's fund implementation strategy with respect to the recovery of depleted marine living resources, particularly WCRL? 
It is astounding that the South African public, and fishing industry in particular, have to date not been presented with the Government's proposed plan for the recovery of depleted resources, especially given the growing social and economic crises afflicting fishing communities with the WCRL trade collapse; the collapse of the pilchard fishery and the annihilation of the legal abalone fishery. 


Sunday, February 23, 2020

A "New Minister"; Another Illegal Decision in the Hake Trawl Fishery Appeals

It is incredible! The Minister of Environment, Forestry and Fisheries has now apparently issued her appeal decisions which have been outstanding since August 2019 when Minister Zokwana's fourth set of decisions in the hake inshore trawl and sole fishery were reviewed and set aside by the Western Cape High Court.

What is patently obvious is that we seem completely content to rely on appallingly bad legal advice. The extent of the illegality of this decision is actually quite breathtaking. In December 2018, Minister Zokwana decided to allocate a total of 36 hake inshore trawl and sole fishing rights. Of these, 17 were granted to existing or historic right holders. The remaining 19 rights were allocated to new entrants. Zokwana's decision in December 2018, followed an unlawful July 2017 decision which was reviewed and set aside on at least 3 separate occasions.

These 19 new entrants had in the interim entered into various types of commitments to have their 15-year fishing rights harvested, processed and marketed. Feike had repeatedly warned the Fisheries Minister since August 2019 that she needed to immediately communicate with the affected new entrant right holders and warn them of the consequences of the Western Cape High Court's August 2019 order and the possibility that their fishing rights may be at risk. No such communications were ever issued. Instead, as we have come to expect from an incompetent and inept Fisheries Department and Minister wracked by corruption and unsuitably skilled senior managers, paralysis was the chosen path.

And now suddenly, a "decision" table is issued sans any explanation or reasons for the tabular record which shows that the number of new entrants has been slashed from 19 to 10! We have a total of 27 right holders in the fishery (down from 36). After more than 3 years of confusion, repeated lost review applications and substantial costs to the industry, we are now back to the pre-July 2017 status quo.

However, it is expected that those new entrant right holders who have summarily lost their fishing rights will seek to urgently review and set aside this latest unlawful set of "decisions".

Monday, October 7, 2019

What is Happening with the Hake Inshore Trawl Fishery Appeals?

In early August 2019, this Blog addressed the most recent set of Ministerial fishing rights appeal decisions set aside by a court of law. This was the fourth time a court of law reviewed and set aside appeal decisions in the hake inshore trawl fishery sector. 

The Western Cape High Court unambiguously ruled in early August 2019 that - 

1. The Minister's appeal decision of 10 July 2017 for the Hake Inshore Trawl Sector stands and is of full force and effect insofar as it establishes that Category A right-holders will share 70% and Category B and C right-holders will share 30% of the total allowable catch for the Hake Inshore Trawl fishery;

2. The First Respondent's appeal decision of 7 December 2018 is reviewed and set aside in its entirety; and the Category B and C appeals are remitted to the First Respondent for her to reconsider allocating 30% of the total allowable catch in the Hake Inshore Trawl fishery to these new entrants.

The Minister has yet to even commence with the reconsideration of the Category B and Category C appeals. In addition, the permits allocated to Category B and Category C "right holders" whose rights have effectively been revoked by the Seavuna court order of August 2019 have not been recalled by the Minister.

At the very minimum, a responsible fisheries department would have issued a STOP FISHING notice  notifying the applicable "right holders" of the revocation of their hake inshore trawl fishing rights by operation of the August 2019 court order. The Minister and department's ongoing silence on such a crucial matter only feeds the rumour mill, fails proper fisheries management and is resulting in entities to fish unlawfully and in contravention of a court order. 



Monday, September 9, 2019

FISHING CO-OPERATIVES: THE REPLICATION OF FAILURE AND STRIFE TO CONTINUE

In the same week that Cabinet had decided to unlawfully "extend" the validity period of commercial fishing by at least 12 months, the Minister of Environment, Forestry and Fisheries, Ms Barbara Creecy, affirmed her continued support for the ongoing allocation of fishing rights to fishing co-operatives that have to date all failed. 

Feike has written extensively about the extent and history of fishing co-operative failures in South Africa; how they have contributed to and fuelled community conflict, resource destruction (what more evidence than the complete collapse of lobster is required); and how they fail to contribute to any form of coastal social or economic growth. Poverty, conflict and unemployment in all coastal villages that have been historically associated with high value nearshore fisheries have increased in the last decade. Poaching has increased massively and we have seen the collapse of abalone and lobster resources over the same period. 

Every fishing co-operative pilot project has failed. EVERYONE. And now the allocation of co-operative fishing rights in the Northern Cape has again confirmed why co-operatives should never be allocated fishing rights. 

But we are so irrationally and ideologically tied to this system, that (like with the NHI, land reform, and every other policy adopted by this government in recent times), evidence-based decision-making is no longer an option or even a consideration. So we will forge ahead and force entire communities into sanctioned conflict, beholden to a co-operative run by hand-picked cadres who sell the "community" lobster to buyers prepared to hand out the highest back-handers to the "decision-makers". The "community" is left to suck on the idiomatic hind-tit.

Essentially, the very creation of "lists" of members to be a part of these "community co-operatives" involves a corrupt and highly contested series of processes, similar to what we see with the infamous municipal "housing lists" or land redistribution processes.  

We should abandon this failed socialist policy of allocating fishing rights to "co-operatives" and undefinable "communities" as if individuals exercising their individual liberties and rights in a market economy cannot decide for themselves how best to sustainably utilise a public resource through a verifiable and accountable regulatory process. (I am sure that in another 5 years' time we will be told how due to "unforeseen circumstances" and "various challenges", every one of these co-operatives has collapsed and unable to account for the millions of rands in fish harvested and sold.)



CABINET'S UNLAWFUL "EXTENSION" OF FISHING RIGHTS

On 8 December 2019, the Minister of Environment, Forestry and Fisheries announced that "Cabinet took a decision on Wednesday, 4 September 2019, to extend the timeframes for dealing with the fishing rights in twelve commercial fishing sectors which will expire on 31 December 2020."

The statement further recorded that:

"The twelve sectors that are due for allocation in terms of Section 18 of the Marine Living Resources Act, 1998 are: KZN Prawn Trawl; Demersal Shark; Tune-Pole Line; Hake Handline; Line Fish; White Mussels; Oysters; Squid; Small Pelagics (Pilchard and Anchovy); Hake Deepsea Trawl; Hake Longline; and South Coast Rock Lobster.

...

The FRAP process will therefore be extended until 31 December 2021.  During this time, the Department of Environment, Forestry and Fisheries (DEFF) will conduct socio-economic impact analysis studies on the General Policy on the Allocation of Commercial Fishing Rights, as well as the 12 Sector-specific polices."
We have stated on this BLOG and on our Twitter handle previously that a Minister (or Cabinet for that matter) cannot decide to extend the validity period of any fishing right. That authority is firmly vested with Parliament. The Minister should propose an amendment bill to Parliament (Akin to what was presented by Minister MV Moosa in 2000, which resulted in the adoption of the MLRA Amendment Act of 2000). It is Parliament - and Parliament alone - that can "authorise" a fishing rights extension to 31 December 2021.

Cabinet's "decision" to extend the validity period (And thus the validity of individual fishing rights across 12 commercial fishery sectors) is thus unlawful and invalid and capable of legal review.

Further, this decision is yet another indictment of the extent of the institutional failure that has come to define this government. Government has had 15 years to prepare for this rights allocation process. 15 YEARS. 180 MONTHS. 5475 DAYS. And yet again, it is unprepared. Yet again, we are told of the same government having to fix corrupt processes of its own making. And yet again, it promises to implement credible and corrupt-free processes despite continuing to fail to purge the staff implicated in corruption and maladministration since FRAP 2013.

Tuesday, August 20, 2019

SA's HAKE TRAWL FISHERY REMAINS IN LEGAL ABEYANCE

Subsequent to Minister Zokwana's legally flawed appeal decisions of December 2018 in the hake inshore trawl fishery, two review applications were brought by right holders in the Category A & Category B sectors (Case number 3330/19) ("the Seavuna matter") and one by Letap Fishing CC (Case number 400/2019). 

The Seavuna matter was finally conceded by Minister Barbara Creecy in early August 2019. Given the concession by the Minister in the Seavuna matter, she will undoubtedly have to concede the review application by Letap Fishing CC as well.

The terms of the order in the Seavuna matter are brief and simple and as follows:

1. The Minister's appeal decision of 10 July 2017 for the Hake Inshore Trawl Sector stands and is of full force and effect insofar as it establishes that Category A right-holders will share 70% and Category B and C right-holders will share 30% of the total allowable catch for the Hake Inshore Trawl fishery;

2. The First Respondent's appeal decision of 7 December 2018 is reviewed and set aside in its entirety; and the Category B and C appeals are remitted to the First Respondent for her to reconsider allocating 30% of the total allowable catch in the Hake Inshore Trawl fishery to these new entrants.

3. There is no order as to costs.

The effect of this concession is rather significant for those new entrants who were granted section 18 hake inshore trawl fishing rights in December 2018. It effectively means that they have now lost their fishing rights. They must halt all fishing and their section 13 hake inshore trawl fishing permits are a nullity. Any fishing on these permits post the date of the court order would be unlawful. 

The appeals filed by Category B and Category C appellants must be reconsidered in their entirety and the Minister can only consider an allocation of no more than 30% of the hake inshore trawl TAC to these two category of right holders. 

All Category B and C right holders are entitled to harvest hake inshore trawl and sole quotas as determined post the 10 July 2017 appeals process, pending finalisation of yet another failed attempt at resolving the hake inshore trawl appeals process. 

(It is hoped that the Minister does appoint a legal team capable of providing legally defendable decisions as opposed to continually retaining expensive "legal" counsel that provides such fundamentally flawed legal advice. It is actually unforgivable for senior lawyers to provide such legally flawed advice to Ministers).