Department of Agriculture, Forestry and Fisheries

REPORT FROM THE FISHERIES BRANCH TO THE PORTFOLIO COMMITTEE

19 FEBRUARY 2013

2013 Fishing Rights Allocation Process

Presentation Outline

Legislative Mandate

Expiration of existing rights

Revision of Existing Policies

Legislative Review

Procurement of Service Provider

Finalisation of the Rights Allocation Process

Proposed Road Map

SWOT Analysis

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Legislative Mandate

Objective of the Marine Living Resources Act, No18 of 1998 (MLRA)

•The main objectives and principles of the MLRA are to provide for the management of marine living resources in a fair and equitable manner for the benefit of all the citizens of South Africa.

•The allocation of fishing rights was the primary mechanism to further transformation and to give effect to all principles and objectives as set out in section 2 of the MLRA

•The MLRA will be amended as part of the department’s overall legislative review

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Expiration of Existing Rights

What next?

-Rights will expire in the following 8 sectors on 31 December 2013:

•KZN Prawn Trawl, •Demersal Shark•Squid•Tuna Pole•Hake Handline•White Mussels•Oysters,•Traditional Linefish.

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Expiration of Existing Rights (cont)

-Rights expiring in 2014:

• Abalone (31 July)

-Rights expiring in 2015:

• Patagonian Tooth Fish (30 January)

• Large Pelagics (Tuna & Swordfish Longline) (28 February)

• West Coast Rock Lobster (Offshore) (31 July)

• West Coast Rock Lobster (Nearshore) (31 July)

• Hake In-shore Trawl (31 December)

• Horse Mackerel (31 December)

• Seaweed (31 December)

• Kwa-Zulu Natal Beach Seine (31 December)

• Netfish (31 December)

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Expiration of Existing Rights (cont)

-Rights expiring in 2020:

• South Coast Rock Lobster (30 September)

• Hake Deep Sea Trawl (31 December)

• Small Pelagics (31 December)

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Revision of Existing PoliciesIdentification of gaps in existing Policies-Marine Living Resources Act and Regulations promulgated there-under.-General Fisheries Policy.-Sector Specific Fisheries Policies

Internal Consultation on Policy considerations- Duration of Rights.

- Transformation.

- New Entrants.

- 2010 Fisheries Performance Review.

- Economic Viability of Rights.

- Beneficiation (Fronting).

- Support Programs.

- Right Transfers (Consolidations by Economic Units).

- Incorporation of Limited Commercial Fisheries in to the Small Scale Fisheries Sector.

- Closure of collapsing fisheries.

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Legislative Review

Legislative Review- Milestones as per DAFF’s legislative Review Roadmap

Public Consultation on Policy Considerations-Marine Living Resources Act and Regulations promulgated there under.

-General Fisheries Policy.

-Sector Specific Fisheries Policies

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Procurement of Service Provider

Public Consultation on Industry “Rule Books”

Setting up of Structures- Verification Unit to audit Applications;- Independent Rights Allocation Unit

- Inter-Governmental Task Team (DAFF, SAMSA, DTI, SARS, DoL)

Design of Application Forms- Application Form based on Criteria and “Rule Book agreed with Stakeholders.

Determination of sizes of Allocations

Call for Rights Application (Outline Process)

Processing of Application Forms and Data Capturing

Allocations by the Delegated Authority

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Procurement of Service Provider (cont)

Calls for Appeals

- Processing of Application Forms and Data Capturing

Announcement of Appeals

Amendments of the Rights Registers

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Finalisation of the Rights Allocation ProcessRights Application Process

1. Minister Calls for Applications in the Government Gazette and the Rights Allocation Process begins.

Minister will delegate Authorities to Allocate fishing Rights to one or two Senior Officials (“The Delegated Authority”)

2. Application Forms and Policy Guidelines will be made available from all Coastal Offices

3. Applications will be submitted to the Rights Verification Unit (RVU) this will come with an Application FeeRVU will receive, file and store applications, and verify the information that is supplied by applicants.

4. Independent Advisory Committee will assess each Application

1. Each application will be assessed by at least two people

2. Each application will be scored according to predetermined criteria. Criteria will vary per fishing sector.

3. Legal Advice will be sought for ‘Complicated’ or ‘Border line Cases’ or applicants that warrant further investigation prior to decision making

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Rights Allocation Process (cont.)

5. The Delegated Authority will decide whether or not to allocate rights, and record his/her decision;

6. Quantum’s will be allocated to each successful applicant.

7. The record of Decision will be made available to all Coastal Offices (Rights Registers)

8. Successful Applicants will be allowed to apply for fishing licenses and vessel licenses

a. Unsuccessful Applicants will decide whether they appeal the Minister’s decision or not.

aa. If they appeal, Appeal Process begins.

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Proposed Road Map

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Activity Output Target ResponsibilityFisheries Performance Review Performance Review Report Completed CD: MRMIdentification of Gaps in the Policies.

Draft Policy Proposals January 2013 CD: MRM

Departmental Discussion on Policy Considerations.

Policy Proposals February 2013 CD: MRM

An Economic Sectoral Study. Performance Review Report Completed CD: MRM, Fishing Industry

Appointment of a Service Provider.

Service Level Agreement November 2012 CD: MRM

Public Consultation Process on Policy considerations.

Public Comments February 2013 CD: MRM, Service Provider, Fishing Industry and Public

Public Consultation on Industry "Rule Books".

Public Comments February 2013 CD: MRM, Service Provider, Fishing Industry and Public

Design Rights Allocation Guidelines.

Rights Allocation Guidelines March 2013 CD: MRM, Service Provider, Fishing Industry and Public

Setting up of Structures. Terms of Reference March 2013 CD: MRM, Service Provider

Design of Application Forms. Rights Application Form March 2013 CD: MRM, Service Provider

Call for Applications Gazette Notice May 2013 CD: MRMDetermination of sizes of allocations.

Approved TAC/TAE June 2013 CD:FRD

Processing of Application Forms and Data Capturing.

Applications Database July 2013 Service Provider

Allocations by Delegated Authority.

Rights Registers September 2013 Delegated Authorities

Calls for Appeals. Gazette Notice September 2013 CD: MRMProcessing of Application Forms and Data Processing.

Appeals Database October 2013 Service Provider

Announcement of Appeals. Decision Report November 2013 CD: MRMAmmendment of Rights Registers.

Amended Rights Registers December 2013 CD: MRM

SWOT AnalysisStrengths- Past experiences- Strong Legislative Framework

Challenges- Very limited resources = Limited access- Growing population- Increasing operational costs of fishing- Apportionment of allocations between sectors + entities

Opportunities- Improved social and economic benefits for South Africans- Small Scale Fishing Dispensation- Expansion of underutilized resources

Threats- Limited time plus protracted bureaucratic processes- Disruption plus instability within the fishing sector- Litigation by industry- Movement of new Right Holders to economic hubs

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Update – MLRF 103 (Rights Allocation) Bid Advertised on 24th August 2012 (Closing 21st September 2012)

Bid evaluated on 31st October 2012

Adjudicated on 10th December 2012-Escalated to the Accounting Officer

Finalized on 23rd January 2013-Split bid (Policy Review + Rights Allocations)

Way Forward- Bid Specification + Evaluation Committee Appointed-Rework Bid Specifications- Advertise- Evaluate and adjudicate - Appoint Service Providers

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STATUS OF THE DAFF FLEET OF FISHERIES PROTECTION AND RESEARCH VESSELS

OFFSHORE FISHERIES PROTECTION VESSEL: SARAH BAARTMAN INSHORE FISHERIES PROTECTION VESSEL : VICTORIA MXENGE;RUTH FIRST AND THE LILIAN NGOYI

FISHERIES RESEARCH SUPPORT VESSEL: ELLEN KHUZWAYO FISHERIES RESEARCH SUPPORT VESSEL: AFRICANA

THE DEPARTMENT’S FLEET OF FISHERIES PROTECTION VESSELS AND RESEARCH VESSELS

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SEQUENCE OF EVENTS

• 21 March 2012 – Letter received to end Vessel Management Contract with Smit Amandla Marine.

• 22 March 2012 – DAFF met with the Chief of SA Navy (SAN) and his team to enquire if the SAN would be able to assist with the management of the DAFF fleet.

• SAN agreed that they could assist and that they were able to fulfill all the functions that were required, including that of the research fishing operations.

• However, SAN indicated that the DAFF fleet would have to fall under the Defence Act as the SAN is unable to operate under the Merchant Shipping Act.

• One of the requirements of the SAN was that the entire DAFF fleet had to be sailed to Simon’s Town so that a full Technical and Logistical survey could be carried out prior to SAN accepting the DAFF fleet. To date the DAFF is still awaiting these reports.

• 28 March 2012 – DAFF fleet instructed to sail to Simon’s Town fully operational.• 31 March 2012 – DAFF fleet temporarily handed over to the SAN to perform Vessel

Management function for interim period of one year. This has proven to be a difficult task for the SAN.

• 31 March 2012 – MOU between the Minister of Defence and Military Veterans and the Minister of Agriculture, Forestry and Fisheries signed. The MOU comes to an end on 31 March 2013. Process for the outsourcing of the DAFF fleet has commenced.

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STATUS OF THE DAFF FLEET

• The status of the DAFF fleet has not changed much since we last presented to the Portfolio Committee. The DAFF fleet is still alongside because the SA Navy has not managed to operationalize the vessels.

• FRS Africana was scheduled to have been busy from about 22 October 2012 to January 2013 doing Pelagic Spawner Biomass Surveys and West Coast Hake Biomass Surveys. The SAN indicated that the Africana was not safe for sea, according to their standards. To date the DAFF is still awaiting a report from the SAN as what was the cause of the ingress of water into the fuel system of the Africana.

• DAFF had to contract industry vessels to carry out crucial surveys.

• FRS Ellen Khuzwayo is still alongside. She is only now undergoing the Lloyd’s Classification survey which was scheduled for September 2012. Due to the FRS Ellen Kuzwayo being alongside, no WCRL surveys or other research have been achieved. Her date for sea readiness is uncertain.

• FRS Algoa has been transferred to the Department of Environmental Affairs (DEA). Since the FRS Algoa, the oldest vessel in the fleet, was handed over to the DEA, she has been to dry dock and has completed two successful surveys. She is currently at sea.

• FPV Sarah Baartman has not sailed to date. She commenced her dry docking in December 2012. She is busy with the Lloyd’s classification surveys. It is uncertain when the FPV Sarah Baartman will be ready for sea.

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STATUS OF THE DAFF FLEET

• The Lilian Ngoyi is not ready to sail – This engine’s service has been outstanding since April 2012. The SAN has now commenced with the engine service. Sea readiness uncertain at this stage.

• The Florence Mhkize is still waiting to undergo sea trials. We are waiting for approval for the services of the contractor. DAFF sourced the quotation from the service provider and is still awaiting the Government order from the SAN to carry out the work.

• The Ruth First has only sailed for 4 days in November 2012. According to SAN she was undergoing sea trials last week.

• The Victoria Mxenge sailed in November 2012 for approximately 8 Days. She is still alongside and her status is uncertain.

• DAFF has removed the Rigid Hull Inflatable Boats from the FPVs and are busy preparing them for sea.

• The Implementation Protocol clearly states and was a requirement of the DAFF that the DAFF fleet remain in class. The SAN allowed the DAFF fleet to be suspended in class and steps now have been taken to return them to class.

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STATUS OF THE DAFF FLEET

• Below please find an email correspondence from the Lloyd's Classification Society on the classification status of the DAFF fleet:

“1. Attached please find current class status of the DAFF vessels.Note that although Victoria Mxenge, Sarah Baartman, Lilian Ngoyi are reflected as classed, these vessels are under survey with overdue surveys being dealt with currently. Class status is subject to all these surveys being completed at this time. Africana is class suspended due to overdue surveys and Conditions of Class. Ellen Khuzwayo is class suspended, however is under survey at this time for completion of outstanding surveys. Once these are dealt with to the attending surveyor's satisfaction, then re-instatement of class will be considered.

 2. Note that ISM certification is only not applicable whilst all vessels fall under the Defence Act. As such there is no valid ISM

certification on any of the vessels at present. This certification would be required if the vessels were transferred out of the Naval management.”

• Below, please find an extract from the Implementation Protocol regarding Technical Maintenance of the DAFF Fleet:

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CHALLENGES / IMPACT

• The SAN cannot the meet the requirements of the DAFF in terms of Managing the DAFF fleet and its operations. The DAFF fleet works on a 24/7 operational basis. The SAN does not have the capacity to meet these requirements in terms of crew and technical expertise.

• Lack of technically qualified SAN personnel as was mentioned by the SAN in Simon’s Town during the visit of the Portfolio Committee.

• The Marine Stewardship Council certification of the hake fishery is due to be assessed in March 2013 and industry and jobs may be threatened.

• The Off-shore fisheries and the Exclusive Economic Zones (EEZ) of South Africa (Local EEZ and the Marion and Prince Edward Island EEZ) are not being patrolled at the moment. We therefore cannot determine whether any Illegal, Unreported and Unregulated fishing is taking place.

• The SAN has assisted with approximately 6 patrols. Of the 6 patrols, 2 were cut short due to Technical problems on the SAN vessels (Engines overheating, etc). The remainder of the patrols were also very short.

• The Chief Directorates Fisheries Research and Development and Monitoring Control and Surveillance will be unable to meet all their targets for the year.

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THE WAY FORWARD

• DAFF has completed a Recruitment and Selection process for the Key Maritime personnel for the Research Fleet.

• The Recruitment and Selection process for the Fisheries Protection Vessels Key Maritime Personnel has commenced.

• DAFF is moving ahead with the tender process for the outsourcing of the Vessel Management of the DAFF Fleet.

• We are also proposing that an emergency approval be granted to obtain a service provider to get the FRS Africana operational as soon as possible.

• We will also apply for an MTEF allocation to replace FRS Africana within the next three years.

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SA EEZMarion and Prince Edward EEZ

DAFF FLEET AREA OF OPERATION

THANK YOU

SADCSADC