FROM COMMON FISH TO RIGHTS BASED FISHING - FISHERIES MANAGEMENT AND THE EVOLUTION OF EXCLUSIVE RIGHTS TO FISH

Since the Second World War the international Law of the Sea has been altered fundamentally. An Exclusive Economic Zone (EEZ) extending 200 nautical miles from baselines has been established, in which the coastal states have practically full sovereignty over natural resources including fish. This development appears explicable in the light of the economic theory of property rights, due to increased scarcity of fish and lower costs of supporting claims to fish resources. The EEZ has major implications for the efficient utilization of fish resources through its limitation of free access. In some cases it amounts to the establishment of national property rights to fish resources, while in others the number of parties with a legitimate claim to access has been restricted. In the wake of this, fisheries management by total allowable catches (TACs) has become widespread. This method of management has a potential for increasing the efficiency of fisheries. Given that a single state, or a group of states, are able to control the fishery, how should this be done to ensure efficiency? Four methods are discussed: (i) Privatization of the resources; (ii) taxes on landings or fishing activity; (iii) fishing licences, and (iv) individual transferable quotas (ITQs). Some questions related to ITQs are discussed; (i) fixed ITQs versus shares in the TAC; (ii) stable versus variable ITQs; and (iii) how the TAC should be set for each particular year. The economic theory of property rights predicts the emergence of private property rights to fish stocks or fishing rights in the present situation. Recent cases of such rights emerging are discussed.