Fish producer organisations v secretary of state legal analysis

31 July 2013

Legal analysis UK Association of Fish Producer Organisations v Secretary of State for Environment, Food and Rural Affairs

UK Association of Fish Producer Organisations v Secretary of State for Environment, Food and Rural Affairs1 is an action for judicial review brought by producer organisations (POs) against the government in relation to the government's 2012 decision to reduce some of the POs' rights to unused quota (in the form of ‘fixed quota allocation units’) for certain fish stocks and to transfer the quota to the inshore fleet (under 10 metre vessels).

On 10th July, the judge, Mr. Justice Cranston, rejected the POs' claims and confirmed not only the legality of the government's decision to reallocate quota in this way, but also the fact that, in this particular case, no compensation was due to the POs for the re-distributed quota/quota allocations.

ClientEarth’s senior biodiversity lawyer Sandy Luk has written a short and quick legal analysis of the recent High Court decision on fishing quota allocation between POs and the inshore fleet.

Summary outcome 1. It is common ground that no-one owns the fish in the sea.

2. The government owns the quota (total allowable catch) that has been allocated to it, e.g. by the EU. 3. The right to quota (or in this case fixed quota allocation units) is a possession/property right.

4. The government cannot unlawfully interfere with or deprive citizens (POs/fishers) of their possessions/property rights (i.e. rights to fixed quota allocation units) - under the European Convention on Human Rights.

5. Fixed quota allocation units that are unused over a number of years have no economic value. Therefore, taking them away does not amount to 'interference' with a possession/property right under the European Convention on Human Rights.

1

http://www.judiciary.gov.uk/Resources/JCO/Documents/Judgments/uk-assoc-fish-producer-orgs-10072013.pdf

6. The government has discretion with regard to the annual allocation of quota, and can distribute quota differently each year if it so wishes, as long as this is done after due consideration, fairly, proportionally and subject to public consultation and a right of appeal.

7. This means that POs have no legitimate expectation that they should continue to be allocated the same rights each year.

8. It also means that re-allocating fixed quota allocation units is not unlawful under the European Convention on Human Rights.

9. If fixed quota allocation units are re-allocated, compensation is payable under human rights law (even though it is done lawfully).

10. Unused quota (over a number of years) has no market value, so there is no financial loss, so no compensation is payable.

The case seems to imply that if the government wants to re-distribute quota in future, they will be able to do so easily in relation to unused quota. Re-distribution of quota that is used can also happen, but only if fishers are compensated for its loss. The case does not specify on what basis the relevant quota would be valued.

A question that might arise is whether there will be an increased incentive on the part of current owners of fixed quota allocation units in POs to make sure that they do use them (to avoid them being reallocated), which might encourage overfishing and/or more discarding, for example if quota is left for a stock in a mixed fishery, and there is no or insufficient quota for the other stock or stocks also caught in the fishery. However, the new Common Fisheries Policy's provisions introducing landing obligations for quota stocks should prevent this.

Discussion The case effectively hinges on the following crucial questions (although other questions are also considered): 1. Did the government have the right to take the relevant quota/fixed quota allocation units away from POs and reallocate it/them to the inshore sector?

2. Is the right to quota/fixed quota allocation units a property right?

3. Is compensation payable to POs? 4. Was there unlawful discrimination?

The judge decided the following: 1. Did the government have the right to take the relevant quota/fixed quota allocation units away from POs and reallocate it to the inshore sector?

The POs argued that the government did not have the right to take away the relevant quota/fixed quota allocation units because: 

the government had created a 'legitimate expectation' for the POs to continue to be given the same quota/fixed quota allocation units as they had been receiving since 1999, whether they were unused or not - thereby making it unlawful for the Government to allocate quota differently; and



the government's decision amounted to an unlawful deprivation of, or interference with, possessions, under the European Convention on Human Rights.

The judge rejected both claims.

He said that no legitimate expectation had been created, because no sufficiently clear, unambiguous and unqualified promises or representations were made that the fixed quota allocation system would continue in its existing form. He also placed emphasis on the fact that quota is managed on an annual basis and allocated yearly, and that it was clear that there was ministerial discretion, and that the government legally owned quota. He also said that 'nothing could be reasonably understood as a representation that fixed quota allocation units were a matter of substantive entitlement and that the system would remain in place without amendments' (although he did hold that quota/fixed quota allocation amounts to a possession/property right - see below).

Similarly, the judge held that there had not been any unlawful interference with or deprivation of possessions under the European Convention on Human Rights, as only unused quota was redistributed, so there had been no 'material economic consequence' (which would have resulted in 'interference'), and the quota re-allocation was not unlawful in itself (the 'decision was based on detailed reasoning, followed consideration of alternatives, was carefully constructed ..., involved extensive public consultation, and ... conferred the opportunity ... to appeal').

2. Is the right to quota/fixed quota allocation units a property right?

Here the judge held that 'fixed allocation quota units are possessions falling within ... the Convention'. They have a monetary value and can be traded. This means that fixed allocation quota units - rights to quota - are possessions/property rights. The consequence of this, in turn, is that even though they may be taken away lawfully (see 1. above), an entitlement to compensation arises under the European Convention of Human Rights.

3. Is compensation payable to POs? In this case, because only long-term unused quota was re-distributed, the quota in question had no market value: there was no financial loss and therefore no need for compensation. The judge

dismissed arguments by the POs valuing the loss of rights at ÂŁ1,405,000 as being purely theoretical and unproven.

The argument that the fish in the sea does not belong to anyone was mentioned and the judgement makes very clear that this is common ground and not disputed. In addition, the fact that fish cannot be owned was used as a justification for saying that the right to quota is not analogous to a 'profit a prendre' (a right to take natural resources from the land owned by someone else).

4. Was there unlawful discrimination?

The last claim the POs brought was one of discrimination between English PO members and fishermen from devolved administrations. This was also rejected.

Sandy Luk Biodiversity senior lawyer ClientEarth 274 Richmond Road London E8 3QW t +44 (0)207 749 5977 e sluk@clientearth.org www.clientearth.org