IWI IKA - supporting iwi fisheries

 

Fishserve Transactions

What is FishServe?

  • FishServe provides administration services to the commercial fishing industry including quota owners.  Some of the services provided include the registration of sales of Annual Catch Entitlement (ACE), registrations for the sale and purchase of quota shares and the collection of fees from quota owners on behalf of the Crown.
  • FishServe is a wholly owned subsidiary of SeaFIC.
  • More information is available online at www.fishserve.co.nz or by calling (04) 460 9555.

What is ACE?

  • ACE stands for Annual Catch Entitlement - a legal property right that allows its holder to catch fish in New Zealand for commercial purposes.
  • ACE always specifies the Fish Stock to which it applies, the weight that can be caught and the time period within which it must be caught.
  • ACE is generated by quota shares and is specific to those quota shares.  For example Snapper 1 ACE is generated from Snapper 1 quota shares.
  • The Quota Share/ACE Converter calculator on the FishServe website will help you convert your quota holdings into ACE equivalents.
  • You must hold a Fishing Permit as well as the appropriate ACE for a fishstock before you can catch that fishstock for commercial purposes.

Example
If Ngati A owns 1 per cent of the quota shares for Snapper 1, and the Total Allowable Commercial Catch (TACC) is 200 tonnes, Ngati A will receive the same percentage of the TACC for Snapper 1 i.e. 1 per cent or 2 tonnes (2,000 kgs) of Snapper 1 ACE.  If in the following year the TACC was to increase to 300 tonnes and Ngati A’s percentage ownership of Snapper 1 quota shares remained the same, Ngati A’s Snapper 1 ACE would increase to 3 tonnes (3,000 kgs).

What can happen if I don’t manage my ACE properly?

  • Any ACE that is not used or sold within the Fishing Year to which it applies will be lost and cannot be recovered.  Unused ACE lapses on the 15th of the month following the close of the Fishing Year.  For example Snapper 1 ACE from the April 2008 Fishing Year will lapse on 15 April 2009.
  • There are certain legal obligations that go with being a quota owner.  If the party that you sell ACE to contravenes these obligations then you as a quota owner can be held liable.  Te Ohu Kaimoana has developed an ACE sale agreement template which transfers these obligations onto the party that buys your ACE.  A copy of the agreement can be downloaded by clicking here.

 

The Fisheries Industry

What is a Commercial Stakeholder Organisation or CSO?

  • CSO stands for Commercial Stakeholder Organisation which are companies and associations owned by fisheries rights-holders that represent the interests of those rights-holders. 
  • CSOs represent and manage the specific affairs of a particular fishery (eg rock lobster), a geographic area (eg northern inshore fisheries), specific fish stock (eg PAU2) or a group of stocks.  For a full list of CSOs click here
  • Representatives on CSOs are appointed by quota owners.
  • The payment of some CSO levies is voluntary.  However, in deciding whether or not to pay CSO levies one must consider the benefit that these organisations provide to iwi quota owners through quota protection initiatives.  CSOs play an important role in the management of fishstocks by the Industry.  If the Industry accepts responsibility for the voluntary management of susceptible fishstocks, the Government is less likely to force regulated restrictions.  All CSO members are entitled to an annual report of how levies are being spent.

What is SeaFIC?
SeaFIC stands for New Zealand Seafood Industry Council - a national organisation that works on behalf of the New Zealand fishing industry.  Its website address is: www.seafood.co.nz.
SeaFIC states its main focus is in shaping policies and the regulatory framework, lobbying for surety of access to fisheries, reducing tariffs, working co-operatively on fisheries management and environmental issues and also providing an avenue for funding for scientific research and value-added information.
SeaFIC is governed by a board of 8 directors who are elected by CSOs.
SeaFIC is funded in 2 ways: by a direct charge to quota owners and by an indirect charge through CSO levies.
SeaFIC is organised into 4 business units: Science, Policy, Trade and Information, and Training through SITO.

What is SITO?
SITO stands for Seafood Industry Training Organisation – one of Seafic’s four business units that deliver nationally recognised training to the NZ Seafood Industry including iwi.  SITO offers a number of courses that are suitable for MIO representatives and AHC directors.

What is the QMS (Quota Management System)?
The QMS (Quota Management System) was introduced to New Zealand in 1986.  It is a system of management that controls the total commercial catch for virtually all the main fish stocks found within New Zealand’s 200 nautical mile EEZ (Exclusive Economic Zone).  There are currently 97 species (including species groupings) or 628 fish stocks in the QMS.

The QMS was introduced because it was seen as the best way to: 

  • prevent overfishing, which had reached critical levels in some inshore fisheries;
  • improve the economic efficiency of the fishing industry; and
  • continue the development of our deepwater fisheries.

In the QMS, commercial fishing rights are allocated as quota. The main characteristics of quota are:

  • it is owned by an individual, company or trust;
  • only New Zealanders can own quota for our fisheries;
  • the right is not created for a fixed term – it is perpetual;
  • it secures a fixed percentage of the available resource;
  • it is fully transferable and divisible; and
  • it is a valuable asset that enables owners to borrow against the quota.

Allocating quota to individual fishers encourages them to ensure catch levels are sustainable over the long term.  It also helps to protect the economic value of the quota for when the fisher chooses to leave the industry.  In the short term quota gives security to fishing companies.  Because they know what their share of the coming years' catch will be, they can plan ahead.  This encourages them to invest in equipment and staff to sustainably harvest, process and market the catch.

What is TAC (Total Allowable Catch) & TACC (Total Allowable Commercial Catch)?
The Quota Management System (QMS) limits the total quantity of fish taken by commercial fishers. The total quantity of fish that can be taken for each QMS fishery is known as the Total Allowable Catch (TAC). From the TAC an allowance is made to provide for recreational fishing, customary Maori uses and other sources of fishing-related mortality. The remainder is available to the commercial sector as the Total Allowable Commercial Catch (TACC). This is the total quantity of each fish stock that the commercial fishing industry can catch that year.

Quota is a right which allows people to own a share of the Total Allowable Catch (TACC) for a particular species in a defined area. Quota can be bought or sold. A quota register is maintained that records ownership of quota and all transfers of quota.

What is a Fishing Year?
There are two primary fishing years in the New Zealand commercial fishing calendar: April to April and October to October.  There is also one minor fishing year which is February to February.  ACE is generated at the beginning of each fishing year and must be caught within that fishing year.  Any ACE that is not caught will expire 380 days following the start of the fishing year.

Where does Customary Catch fit?
The Kaimoana Customary Fishing Regulations 1998 and the Fisheries (South Island Customary Fishing) Regulations 1998 strengthen some of the rights of tangata whenua to manage fisheries.  These regulations let iwi and hapü manage their non-commercial fishing in a way that best fits their local practices without having a major effect on the fishing rights of others. When the government sets the total catch limits for fisheries each year, it allows for this customary use of fisheries.

 

Payments & Fees

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What fees do I have to pay as a quota owner
The Commodity Levy is charged by SeaFIC and consists of a Core Services Levy and a Stock Specific Levy.

All quota and ACE owners incur FishServe levies which are charged monthly.

Quota owners are charged Cost Recovery Levies by the Ministry of Fisheries but which are collected by FishServe.  These levies are set by the Ministry each year and the rates are dependant on the value of the particular species.  The levies are invoiced monthly by FishServe and are required to be paid by the 25th of each month.

How do I know whether I owe any fees?
Any quota owner can check whether they owe fees by logging on to their FishServe website account.  Do this by first entering your Client Number and Password (top right hand corner) and then clicking on “Your Account Balance” which is in the “Services” section of the FishServe website.  Your Account Balance will give you a list of the source of the fees, what amounts have been paid to date and your total amount due.

What is the purpose of these fees?
Unlike many of the other New Zealand industries, the fisheries industry is largely a user-pays industry.

What are my payment options?
You can pay upon receipt of your monthly invoice from FishServe or you can set up direct debit payments with FishServe so that the exact amounts due are automatically deducted from your bank account each month.

Why do I pay both Te Ohu Kaimoana as well as FishServe fees?
If an iwi has received its first allocation of population-based quota but has not yet received its coastline, harbour or freshwater quota then it will receive two sets of fees.  It will receive a set of fees from FishServe each month for any population-based quota that was transferred to the iwi when it established its MIO.  The other set of fees are issued by Te Ohu Kaimoana for the quota that Te Ohu Kaimoana continues to hold on the iwi’s behalf.  Te Ohu Kaimoana collects this fee from iwi through the April and October ACE Rounds and Te Ohu passes these fees on to FishServe on iwi’s behalf.  Once and iwi receives its full deepwater, inshore, harbour and freshwater quota entitlements, it will pay all of its fees directly to FishServe.

 

MIO & AHC Responsibilities

What is a MIO?
MIO stands for Mandated Iwi Organisation and is the name given to an iwi organisation that is mandated by iwi members and recognised by Te Ohu Kaimoana to receive an iwi’s fisheries settlement assets under the Maori Fisheries Act 2004.

What is an AHC?
AHC stands for Asset Holding Company and is the generic name given to a subsidiary company of the MIO, established to hold and manage an iwi’s quota and AFL income shares on behalf of the MIO.

What is the difference between a MIO & an AHC?
A MIO entity is the governance entity and has ultimate responsibility and is accountable to iwi members for the fisheries settlement assets.  The AHC has more of a business role in making profits from the fisheries settlement assets.  Any profits made by an AHC must either be passed to the MIO or reinvested in the AHC business or a combination of both.

What happens if a MIO does not meet its reporting requirements under the Maori Fisheries Act?
If a MIO does not meet its reporting requirements under the Act, an adult iwi member has the right to make a complaint to the MIO and may take the matter to the Maori Land Court.

What are the MIO reporting requirements in the Maori Fisheries Act?
This website contains reporting templates to help you meet all of your reporting requirements under the Maori Fisheries Act. 

 

Managing ACE

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What does ‘Shelving ACE’ mean?
The shelving of ACE is a fisheries industry management tool designed to conserve susceptible fish stocks.  ACE shelving works by quota owners voluntarily setting aside a portion of their ACE for a particular fish stock.  The shelved portion is not to be fished.  Quota owners sometimes agree to transfer their shelved portion to an organisation to hold the total shelved amount.  Shelving is promoted by the commercial industry where a species is under threat and is a form of industry self-management rather than having the TACC for that species reduced by the Ministry of Fisheries.

Do I need to shelve my ACE?
Shelving is encouraged as a means of self-management of species that are under threat.  Self-management in this way can starve off forced TACC reductions.

How do I know whether I’m getting a good deal for my ACE?
As with the sale of a home and any other valuable asset the best way to find out whether you are getting a good deal for your ACE is to obtain an ACE valuation.  An ACE valuation will tell you what the market is currently paying for your ACE type and volume.  Valuations are guides only and just like buying or selling a home, you can find better deals if you are willing to put in the extra time and research.  You can obtain an ACE valuation by contacting a quota broker on the internet or in the yellow pages.

Should I sign a contract with the person who wants to buy my ACE?
There are certain legal rights and obligations that attach to the sale and purchase of ACE.  It is advisable that an AHC enters into an agreement with any person or organisation that wants to purchase an iwi’s ACE.  This way both the AHC and the buyer will be aware of respective rights and obligations.

Which of my fish stocks are more valuable than others?
The best way to work out the value of your stocks is to obtain a valuation of your quota and a separate value of your ACE.  The valuations will rank your quota and ACE from high to low value.

What are the stock codes for each fish?
The reporting of commercial catches requires the use of three-letter codes.  The FishServe website contains a table of QMS codes and matching Species Name.  The table has been reproduced below and is organised by Species Code in alphabetical order.  QMS codes are also published in hardcopy each year in the The Atlas of Area Codes and TACCs.

Species Code Species Name
ANC Anchovy
ANG Freshwater Eels
BAR Barracouta
BCO Blue Cod
BIG Bigeye Tuna
BNS Bluenose
BUT Butterfish
BWS Blue Shark
BYA Frilled Venus Shell
BYX Alfonsino & Long-finned Beryx
CDL Cardinal Fish
CHC Red Crab
COC Cockle
CRA Rock Lobster
DAN Ringed Dosinia
DSU Silky Dosinia
ELE Elephant Fish
EMA Blue Mackerel
FLA Flats
FRO Frostfish
GAR Garfish
GLM Green-lipped Mussel
GMU Grey Mullet
GSC Giant Spider Crab
GSH Ghost Shark
GSP Pale Ghost Shark
GUR Gurnard
HAK Hake
HOK Hoki
HOR Horse Mussel
HPB Hapuku & Bass
JDO John Dory
JMA Jack Mackerel
KAH Kahawai
KIC King Crab
KIN Kingfish
KWH Knobbed Whelk
LDO Lookdown Dory
LEA Leatherjacket
LFE Long-finned Eel
LIN Ling
MAK Mako Shark
MDI Trough Shell
MMI Large Trough Shell
MOK Moki
MOO Moonfish
OEO Oreos
ORH Orange Roughy
OYS Oysters Dredge
OYU Oysters Dredge
PAD Paddle Crab
PAR Parore
PAU Black Paua & Yellowfoot Paua
PDO Deepwater Tuatua
PHC Packhorse Rock Lobster
PIL Pilchard
POR Porae
POS Porbeagle Shark
PPI Pipi
PRK Prawn Killer
PZL Deepwater (King) Clam
QSC Queen Scallop
RBM Rays Bream
RBY Rubyfish
RCO Red Cod
RIB Ribaldo
RSK Rough Skate
RSN Red Snapper
SAE Triangle Shell
SBW Southern Blue Whiting
SCA Scallop
SCC Sea Cucumber
SCH School Shark
SCI Scampi
SFE Short-finned Freshwater Eel
SKI Gemfish
SNA Snapper
SPD Spiny Dogfish
SPE Sea Perch
SPO Rig
SPR Sprats
SQU Arrow Squid
SSK Smooth Skate
STA Giant Stargazer
STN Southern Bluefin Tuna
SUR Kina
SWA Silver Warehou
SWO Swordfish
TAR Tarakihi
TOR Pacific Bluefin Tuna
TRE Trevally
TRU Trumpeter
TUA Tuatua
WAR Common Warehou
WWA White Warehou
YEM Yellow-eyed Mullet
YFN Yellowfin Tuna

 

Trading Assets

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Can an iwi sell its fisheries settlement assets?
There are several legislative restrictions governing the sale of fisheries settlement assets.  Basically a MIO is able to sell fisheries settlement assets but only after it has obtained the approval of 75% of its iwi members amongst other requirements.  The process involved is very similar to the sale of Maori land where potential purchases must be another MIO or an organisation within the Te Ohu Kaimoana Group.  Furthermore a MIO cannot sell any assets within 24 months of becoming a MIO and is not able to gift assets.  The restrictions apply to settlement quota and AFL income shares.

If a MIO doesn’t want to sell its settlement quota, can it swap instead?
Yes, as an alternative to selling settlement quota a MIO can swap or exchange with another quota owner.  Swapping or exchanging quota is a good option for iwi who want to specialise in certain species or groupings such as inshore versus deepsea quota.  The value of the quota to be swapped must be within 5% of the value of the quota that will replace in exchange.

Can I only swap my quota with non-Maori?
Settlement quota can be swapped for any quota.  It doesn’t matter who owns the quota that you are exchanging for.  But what does matter is that the quota that you exchange automatically converts into settlement quota at the point of the exchange, irrespective of its former status.

What are my AFL income shares?
There are 125,000 income shares in AFL.  20% of these belong to Te Ohu Kaimoana and the remaining 80% belong to iwi.  The income shares belonging to iwi are to beheld by Te Ohu Kaimoana until a MIO is established for an iwi at which point the income shares are transferred to the MIO via its AHC. (ss 67, 76, 77, 90, 103, 137 & 139)

Each iwi receives ownership of a portion of the 80% belonging to iwi according to the population of that iwi compared with the total iwi population across the country as taken from the 1996 and 2001 Census.

When will AFL pay a dividend on our income shares?
The Chairman and CE of AFL have indicated that the company will pay its first dividend to iwi income shareholders at the end of 2010.

Not less than 40% of AFL’s consolidated group (including AFL subsidiary companies) net profit after tax must be paid annually to income shareholders.  AFL has indicated that other matters will be  at the latest or in any circumstance that would put AFL at risk of breaching the Companies Act 1993.  The formula for calculating your dividend is as follows:

AFL Net Profit After Tax (for AFL Consolidated Group) x 40% (Minimum dividend payment to all shareholders) x 80% (Iwi shareholding) x Iwi percentage of total notional iwi population percentage (Column 3 of Schedule 3 Maori Fisheries Act)