The Russian government has finally approved a package of amendments to the federal law ‘On Fishing’, which may result in a significant change to the balance of powers in the Russian fishing market, reports Eugene Gerden.
The amendments have lengthened the duration of quotas from 10 to 15 years and involve the allocation of 20% of their volume for investment projects.
In addition, the new amendments have increased the minimum amount of quota use from 50% to 70%. Finally, up to 70% of fish that is caught in accordance with the quotas should take place on vessels owned by the quota holders.
The latter, according to the plans of Rosrybolovstvo, should result in the withdrawal of so-called fish rentier from the market, and in particular those companies that transfer their right to catch to third parties.
The latest amendments have already been criticised by leading Russian fish producers. According to Alexander Fomin, president of the Russian Association of Fishery Enterprises, Entrepreneurs and Exporters, the removal of 20% of the quota for investment purposes, among which are projects including the purchase of new vessels from Russian shipyards and the establishment of processing plants, would lead to "significant imbalance of production capacities and resource base in the Russian fish market."
According to the Association, currently more than 1,000 enterprises are involved in fish catching in Russia. Of these enterprises, about 80% of the overall catch accounts for 170 large companies, while the remaining are small and medium-sized companies.
According to Fomin, the allocation of 20% quota for the implementation of investment projects will negatively affect the resource security of small and medium-sized fish enterprises, and may result in their bankruptcy.
