Will ranking China’s distant-water fishing firms encourage sustainable practices?

Commenting on the state of China’s distant-water fishing, Zhang Xianliang, an official with the Ministry of Agriculture’s Bureau of Fisheries, said there are many with little risk resilience and poor management. “We are still seeing regulatory breaches and safety incidents in overseas waters,” he said, stressing the need to change how the industry is developing.

As part of addressing the issue, in March this year the Ministry of Agriculture released its second annual compliance rating scores for distant-water fishing (DWF) companies.

The China National Fisheries Corporation came top, with 106.1 points. In last place was Zhoushan Zhenyang DWF Ltd, with 54.7.

China has the world’s largest DWF fleet, and so how those vessels are regulated is of international concern. Illegal, unreported and unregulated (IUU) fishing threatens the sustainability of fish populations and the fishing industry itself. So, China has put a number of new regulatory measures in place, including this annual scoring of DWF companies.

Sally Yozell, senior fellow and director of the environmental security programme at the Stimson Center, a US thinktank, says “it’s fantastic that China is starting to acknowledge the problems of IUU fishing with its fleet” and is taking “very positive” actions.

Ranking DWF firms

This was the second year rankings have been published, with 180 firms rated on their compliance with Chinese and international DWF regulations.

The process involves each firm evaluating its own performance. That assessment is then checked by the local fishing authorities, before being passed on to the Ministry of Agriculture for publication.

According to the ministry’s website, 42 factors are considered, across four areas: internal rules; supervision and management; compliance and innovation; and violations.

“Internal rules” means internal governance, safety and crew management. “Supervision and management” looks at whether or not the company’s fleet submits to required monitoring and reports all relevant data. “Compliance and innovation” covers use of sustainable equipment and methods, as well as voluntary use of up-to-date monitoring and traceability systems. “Violations” means breaches of laws and regulations, including unlicensed fishing, illegal cross-border fishing and failure to keep vessel monitoring systems activated.

Firms gain points for following regulations and lose points for breaches. However, the Ministry of Agriculture only publishes an overall score for each firm – details of how those figures were reached are not made public.

Zhou Wei, senior oceans campaigner with Greenpeace East Asia, thinks that the first three of those areas can largely be assessed via day-to-day business records. But gathering information on regulatory breaches could be more complex.

She points out that companies have little motivation to hand over proof of their own breaches, and it can be difficult for the authorities and technical support agencies to verify submitted data. The technology currently in use does not allow all activities of a DWF vessel to be monitored in all weathers. It is still possible, therefore, for breaches to go under the radar of regulators.

Companies submit information and supporting materials on their regulatory compliance, which is then audited by the provincial fishing authorities, aided by technical support bodies such as Shanghai Ocean University and the China Distant-water Fisheries Association.

Zhou Wei points out that the Chinese government will not be aware of breaches committed by Chinese vessels in the exclusive economic zones of other countries, unless an information-sharing arrangement is in place with the host government.

Closing that information gap, says Zhou Wei, will require Chinese regulators and the technical support agencies to actively gather information. Also, more transparency – such as regularly publishing the names of China’s DWF vessels – would encourage oversight by civil society and the public.

“In the United States, basically, when our companies are out of compliance, we fine them. We put them in jail,” says Sally Yozell.

“The important question is, how transparent is China going to be with this [compliance] data? How is that data going to be used during enforcement?”

As far as she is aware, China’s system of ranking DWF companies is unique.

Zhou Wei sees the system as still in a trial period, and so the results shouldn’t be used for rewards or punishments. So far, there have been no reports of that happening.

“China has the largest distant-water fishing fleet in the world. It fishes all round the world,” says Yozell. She believes publishing detailed information on DWF companies would help countries in West Africa, the Pacific, East Africa and South America evaluate them before providing fishing licences.

International pressure

According to the Ministry of Agriculture, the ranking system has drawn on the experiences of regional fisheries management organisations (RFMOs). It aims to “encourage” rather than force companies into “improving their management systems and implementing strict supervisory measures… avoiding illegal behaviour.” In other words, a high ranking may make a company look good while a low one may bring stigma. The ministry has also said it plans to use the compliance data as a factor in issuing DWF licences and providing support for the industry.

Julian Chen, a fishing industry researcher at Greenovation Hub, a Beijing-based NGO, said RFMOs set rules for governments and fishing vessels in order to restrict fishing activity, conserve fishery resources and ensure the sustainable development of regional fisheries. China’s DWF ranking essentially translates RFMO compliance requirements and China’s own DWF management rules into a scoring system.

Chen explained that RFMO oversight relies on both monitoring of real-time location data, as well as cooperation with port states, coastal states and flag states. Port states check landed catches, while coastal states may patrol nearby waters via coastguards. He says countries that fish generally “have a central authority aware of the movements of their fleets, and they are obliged to take administrative or legal action against vessels when informed of breaches by RFMOs”.

According to Chen, RFMO standards are getting tougher, with a knock-on effect on compliance requirements. Countries with stronger fisheries management also try to export their standards, putting other countries under pressure.

China bolstering management of DWF

According to a 2020 Ministry of Agriculture white paper on DWF compliance, as of the end of 2019, China had 178 registered DWF firms, operating 2,701 fishing vessels. Of these, 1,589 fished on the high seas on the Pacific, Indian, Atlantic and Antarctic oceans, as well as in the national waters of other countries.

The 13th Five Year Plan (2016–20) for the DWF sector said that, to protect fishery resources, there would “in principle” be no more licences for DWF firms or vessels, and the fleet would be no larger than 3,000 vessels.

“Keeping capacity under control will also help tackle IUU fishing,” says Zhou Wei. “If there’s too much capacity, vessels are more likely to risk breaking the rules as they compete for catches.” She expects these measures to continue into the 14th Five Year Plan period (2021–25).

Sally Yozell thinks China could go further, by abolishing fuel subsidies, which encourage overcapacity and overfishing. Those subsidies mean bigger vessels spending more time at sea and catching more fish.

Zhou Wei says China has toughened up on the DWF sector in recent years, with new or revised regulations, and some measures look very strict when compared against those in force in other countries. For example, Chinese vessels are required to report their location to the Ministry of Agriculture every hour, compared to every four hours before, and observers are now required on all transhipment vessels.

A 2020 revision of DWF regulations created a “blacklist”, which will see company executives, managers and captains given temporary bans from the sector if they are found to be involved in regulatory breaches.

Zhou Wei says the blacklist targets individuals, while the ranking system is focused on companies – different approaches, both intended to improve DWF management.

“Reasonable oversight from civil society and the public can also encourage firms to improve compliance,” says Zhou. She also points out that a review of investigations and sanctions of DWF firms over recent years shows these often originate with reports from Chinese or international NGOs, or the public.

China still needs to improve its systems for oversight of DWF activity. The Ministry of Agriculture says China supports tackling IUU fishing via port monitoring and is actively looking at joining the Food and Agriculture Organisation’s Agreement on Port State Measures, implementing cross-departmental cooperation, and steadily improving its ability to carry out port checks.

Sally Yozell hopes China will sign up to the agreement. “Seafood traceability is expanding all around the world”, meaning better mechanisms to prevent IUU fish from reaching the market, she says.

She adds that tackling IUU fishing will not make fish more expensive or result in less consumption of fish. But IUU fishing will result in fish disappearing from the ocean more rapidly, harming compliant firms. Creating a fairer market will mean more sustainable fisheries, and more wild-caught fish available to eat.