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The Hague Tribunal Supports Policy Freedom in BAR Funds Distribution

Click on the flag for more information about Netherlands NETHERLANDS
Thursday, June 20, 2024, 07:00 (GMT + 9)

The State of the Netherlands was not obliged to offer the pelagic sector more financial compensation as a result of Brexit.

The District Court of The Hague ruled this out last month in a substantive case regarding government liability in which the pelagic shipowners had summoned the State. The central question in this case was whether the State had an obligation to offer the pelagic shipowners more financial compensation from the BAR funds than they have now received.

Source: Visserij Nieuws

185 million euros

As a result of Brexit, the Netherlands has lost a relatively large number of pelagic fishing rights to the United Kingdom. The pelagic shipowners have estimated the damage at approximately 185 million euros.

“The State has great policy freedom when establishing regulations such as the relevant subsidy scheme. It is pre-eminently the public task of the State to weigh all social interests involved in a scheme against each other. The judge must therefore exercise the necessary restraint when assessing regulations. In this judgment, the court comes to the conclusion that no legal norms can be identified that mean that the State could not reasonably have designed the subsidy scheme as it did. It is particularly relevant that the State may reasonably have chosen not only to look at the size of the lost quotas when answering the question of which sector was most affected by Brexit," the Court said in a summary of her statement.

Trawlers

In the pleadings, the lawyers pointed out that Dutch trawler fishermen caught approximately 63 million kilograms of fish in 2020 and Dutch pelagic trawlers caught a total of 228 kilograms of fish. The Brexit agreement of 20 December 2020 agreed that approximately 25 percent of the EU's fishing opportunities in British waters should be gradually transferred to the United Kingdom in the period up to 2026. New negotiations will then take place.

Source: Van der Zwan -->

To counter the negative consequences of the UK's withdrawal, the EU has set up an emergency fund, the Brexit Adjustment Reserve (BAR). The Netherlands could claim 886 million euros from this, of which 200 million euros for fisheries (of which less than 135 million was ultimately paid out). The trawlers have not received more than EUR 21 million. According to the pelagic shipowners, the three BAR schemes – shutdown scheme, restructuring scheme and liquidity scheme – were genuinely much more geared towards financial compensation for the trawler fishermen.

Worst hit?

From 2021 onwards, the cooperative Shipowners' Association for Sea Fisheries (RVZ, in which the pelagic shipowners are represented) has submitted various memos to the minister for the expenditure of BAR funds. The minister has not adopted this. The State has been held liable on several occasions by the shipowners, but has always responded negatively. The pelagic shipowners argue that they caught 53 percent of the fish caught by Dutch fisheries in UK waters, and that BAR funds should specifically be spent on fishermen most affected by Brexit. Now there was a lack of 'meaningful compensation' from the pelagic fishermen for the permanent loss of quotas.

The State disputes that the pelagic fishery has been hit hardest by Brexit. It is pointed out that the pelagic shipping companies are part of wealthy, internationally operating companies and their large trawlers can be deployed anywhere in the world. The trawler fishermen, on the other hand, are more small (family) businesses with a limited fishing area and with little or no financial buffers. That is why the focus of the expenditure of BAR funds has been placed on the much larger group of trawler fishermen for whom Brexit would lead to structural disruption of their livelihood.

Denmark

Both the pelagic shipowners and the trawler fishermen accuse the Ministry of Agriculture, Nature and Food Quality of not having opted for a subsidy scheme like Denmark. Danish fishermen have been compensated for the permanent loss of quota due to Brexit. It is unfortunate that the Netherlands always said during the negotiations that such a scheme would not stand up to the European Commission due to state aid rules, but it subsequently turned out that the EC does allow such a scheme.

SourceDanmarks Pelagiske Producentorganisation

The State has explained that the Dutch fishing regulations are aimed at finding a new balance: the restructuring scheme makes it possible for fishermen to leave the market without risk, so that sufficient quotas are again available for those who do remain in the market. to operate profitably. According to the State, a scheme based on the Danish model would not have made any contribution to this Dutch policy, because after the compensation, fishermen will continue to be confronted with lower catch quotas for fish stocks in British waters.

Apart from that, according to the State, there is no transparent market for quotas in the Netherlands - unlike in Denmark. The State therefore does not believe that the EC would have also allowed the arrangement permitted for the Danish situation to the Netherlands. The State also points out that the EC did not approve the Danish scheme in one go, but asked questions about the scheme several times before - ultimately - approving it. According to the State, it would therefore have been a risky choice to submit such a scheme: if an approved scheme had not been submitted on time, the BAR funds would have passed by the Netherlands.

The court is of the opinion that the State could reasonably have opted for a design other than that of the Danish subsidy scheme.

Source: Visserij Nieuws (Translated from the original in Dutch)

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