FAO - TECHNICAL CONSULTATION ON LEGAL FRAMEWORKS AND ECONOMIC POLICY INSTRUMENTS FOR SUSTAINABLE COMMERCIAL AQUACULTURE IN AFRICA SOUTH OF THE SAHARA

SUMMARY

This paper identifies the elements of good aquaculture legislation. There is no single model of ideal legislation that will encourage the emergence of a sustainable commercial aquaculture industry. Successful aquaculture legislation must deal with a list of issues and adopt solutions from a limited range of possibilities. The aquaculture law of an individual country must provide the operator with a secure right to conduct aquaculture operations, to the property on which the fish farm will be located and to water of the necessary quality. It must also establish control over the industry through a permit or licence system, which will provide the basis for ensuring the environmental sustainability of aquaculture by examining the suitability of the proposed location of fish farms and the potential environmental effects of their operations. The legislation should subject proposals to an environmental impact assessment only when they threaten to harm the environment seriously. Environmental supervision must extend to controls over the use of exotic species and products of biotechnology and to any water quality concerns created by the proposed project. To encourage the development of a commercial industry, the system should ensure that environmental goals are met without imposing unnecessary costs on applicants. It is recommended that countries adopt a single window approach for the numerous approvals usually required for an aquaculture operation and screen initial applications so that only those that create a significant risk of environmental harm are subjected to a full environmental impact assessment. Countries should also consider creating a single agency to promote aquaculture and to monitor the progress of applications through other government departments.

I. INTRODUCTION

1. Aquaculture plays a critical role in national economies, food security and poverty alleviation in many countries. This role is likely to be even more important in the years to come because of the steadily expanding population and the consequential rising demand for food, including fish food.

2. The FAO Fisheries Department has launched a programme to assist developing countries, especially in sub-Saharan Africa, to develop and implement policies that will encourage the emergence or development of sustainable commercial aquaculture. An array of studies has been undertaken under this programme. Some aim at achieving a thorough understanding of the conditions necessary for the development of a sustainable commercial aquaculture industry, others deal with policies for the promotion of commercial aquaculture, the economic feasibility of commercial aquaculture, and markets and trade mechanisms for farmed fish in sub-Saharan Africa.

3. One of the studies deals in particular with the legal, regulatory and institutional framework for promotion of sustainable commercial aquaculture. It assesses the legal, regulatory and institutional framework that is required to enable commercial aquaculture to occur in individual countries in sub-Saharan Africa where other conditions for the development of the industry are met. The ultimate goal is to assist those countries in developing a set of laws that will encourage the development of the industry, while ensuring that the necessary environmental controls are in place. Although the adoption of a workable legal regime is no guarantee that commercial aquaculture will emerge or develop, it provides an essential first step in the process.

4. The report of the study outlines five case studies, from each of Madagascar, Malawi, Mozambique, Nigeria and Zambia, of the existing legislative, institutional and regulatory regimes that apply to aquaculture. In each country, the study examines the extent to which the legal framework contributes to the development of a sustainable commercial aquaculture industry and recommends the changes that are necessary to provide a secure legal foundation for future development.

5. Although the conclusions are specific to each country, they deal with issues that are important to the entire region. The case studies of the state of aquaculture legislation are based on national laws and regulations that were available at FAO in Rome in early 2001. In the cases of Malawi and Zambia, these materials were supplemented by information gained from missions to those countries in February 2001. The present paper has been elaborated on the basis of this study.

II. WHAT IS SUSTAINABLE COMMERCIAL AQUACULTURE

6. All the studies made under the programme referred to above have taken a uniform approach to the definition of sustainable commercial aquaculture. For ease of reference, these definitions are summarised in this section, with a focus on those elements that are particularly important in assessing the laws and regulations upon which aquaculture depends.

7. The Committee for Inland Fisheries of Africa, CIFA defines commercial aquaculture as the rearing of aquatic organisms with the goal of maximising profit and mainly by the private sector, without direct financial assistance from donor or government sources. This definition emphasises that the prime objective of the commercial operation is to grow fish for maximum profit, in contrast to rural aquaculture¹, in which most of the output is consumed by the producer and his or her immediate family. However, a fish farm is not classified as commercial merely because it sells fish. The defining features of a truly commercial operation are found in the existence of a business orientation and in the use of hired labour, instead of a total reliance on family members. These factors create the potential for alleviating poverty and increasing general living standards.

8. This definition points out the key features of commercial fish farming, and does not obscure the fact that aquaculture occurs along a continuum from subsistence operations to genuinely commercial farms. An operation, which began for the purpose of subsistence, may well develop under the right conditions into a small-scale commercial venture. Generally, the legal conditions which foster the development of smaller commercial ventures are the same as those which will encourage the medium to larger scale enterprises that are the primary focus of this paper.

9. Sustainability is used in two different senses in the context of African aquaculture: financial sustainability and environmental sustainability. Financial sustainability of the aquaculture operation implies that it must offer the prospect of competitive profits and a stable level of returns over the long term. From the viewpoint of law and legal institutions, the financial sustainability of aquaculture is one aspect of its commercial nature. The same legal conditions that can enable commercial aquaculture to occur in the first place must be continued over time if the industry is to flourish financially over the long term.

10. Environmental sustainability refers to the environmental responsibility of aquaculture operations. It is, for example, accepted that aquaculture must be environmentally friendly and that sustainable development from an environmental viewpoint requires intergenerational equity, so that aquaculture's contribution to future generations will be at least as high as the present. In this sense, it is noted that commercial aquaculture can lead to environmental damage which imposes external costs on the remainder of society. Thus, legal and other instruments are required to limit or avoid ecological damage. In this paper, the term "sustainability" will be used to refer only to the environmental sustainability of aquaculture.

11. In practice, the two elements of commercial viability and environmental sustainability are inextricably linked. Environmental regulations are an indispensable element in good aquaculture laws, but if their application imposes excessive costs on the operator, aquaculture will not be commercial either initially or in the longer term.

12. This danger can only be avoided by ensuring that environmental legislation is designed so as to achieve the precise goal of ensuring that the total costs of the aquaculture operation, including its external or social costs, do not exceed the benefits that it produces. In addition, the environmental legislation must be designed and administered to ensure that environmental goals are met, while avoiding the imposition of unnecessary costs that will discourage development.

III. CHALLENGES FACING SUB-SAHARAN AFRICAN COUNTRIES

13. The development of aquaculture has varied from one continent to another and the challenge in sub-Saharan Africa is to develop approaches to sustainable commercial aquaculture development that are realistic and achievable in the context of present social, economic, environmental and political environment. The challenge will be not merely to encourage producing aquaculture products but rather to create a basis or environment that facilitates and supports the emergence and development of sustainable commercial aquaculture.

14. To ensure sustainable commercial aquaculture, individual governments must, however, have the political will and determination to orient their policies towards such aquaculture development and to elaborate programmes to accommodate the effective implementation of such policies, including legal and institutional orientations.

15. In doing so, governments ought to recognise aquaculture as a distinct economic activity, preferably a distinct agriculture enterprise or commodity and review current legal and institutional structures to address the specific characteristics and needs of aquaculture.

16. A major challenge in reviewing or preparing legislation is that there is no single model of an ideal aquaculture law to encourage development that is both commercial and sustainable. Successful legislation must deal with a list of issues and adopt solutions, within a given social, economic and political environment, from a limited range of options.

17. Each country must mould its legal framework for aquaculture in the light of its own legal heritage and the particular problems which it faces. For instance, because of some land laws in place, it may be problematic to secure a durable right to land in countries where land-based aquaculture is not considered at the same level as an agricultural activity, the latter benefiting from greater stability. Such lack of consistency may refrain operators from starting or developing an aquaculture activity. Recognition by law of the resemblance between an agriculture and aquaculture activity may therefore play a crucial role.

18. Whether an aquaculture law comes under the umbrella of environment legislation, fisheries legislation or other natural resources management law is not crucial at this point to guarantee that such a law will induce the development or emergence of sustainable commercial aquaculture.

19. The law has dealt most often separately with the commercial and sustainability issues in aquaculture but both issues are intrinsically linked. The total legal framework for aquaculture must "reconcile the needs of the environment with the facilitation of an efficient aquaculture industry which functions in the common interest of all".

20. Environmental controls are typically imposed in separate legislation that is not restricted to aquaculture but which applies to many different forms of resource use. This has led in several countries to the imposition of significant if not excessive costs on the aquaculturists either when they apply for the necessary authorisations to conduct aquaculture or when they operate an aquaculture facility. This lack of reconciliation also causes uncertainty about the setting up of an aquaculture facility because there are several sources for the grant of rights to conduct aquaculture operations. In the long run, commercial investment may be discouraged.

21. The laws should be supplemented by institutions which recognise the unique issues that arise in aquaculture and which encourage its responsible development. Effective enforcement of rules relating to aquaculture operations is essential if a legal framework is to be useful for developing sustainable commercial aquaculture.

22. It must be emphasized that it is not sufficient for a country merely to adopt a conducive legislation to govern sustainable commercial aquaculture. Such legislation must be enforced; there is no alternative to an effective inspectorate and a well thought out system of sanctions. A major challenge in this regard is often how to put in place a link between the authorisation process and the effective enforcement of rules relating to the day-to-day operations of aquaculture.

23. But nothing will replace either an effective extension service to support the emergence and development of sustainable commercial aquaculture or a straightforward system for stakeholder (individual and communities) involvement in all levels of decision-making. A challenge for governments is to build in an aquaculture law mechanism(s) to encourage and support participation of all stakeholders in setting the objectives of a law, in identifying problems inhibiting the achievement of those objectives, the possible means to overcome those problems and the resources and institutional arrangements required.

24. This choice of one or more mechanisms will certainly depend on the legal and institutional environment, decision-making processes and the capacity of stakeholder groups/organizations. However, none of these mechanisms should be static; they should rather be flexible and adaptable to changes over time.

25. Aquaculture legislation will be more stable and enduring if it is legitimate and because it is considered legitimate by all directly or indirectly affected developments, compliance will be greater.

IV. A CONDUCIVE LEGAL FRAMEWORK

26. The following section first discusses the legal provisions that are necessary to enable commercial aquaculture to flourish. It then examines the controls that are necessary in the interests of environmental sustainability and the difficult problem of ensuring that those controls are designed so that they do not discourage the establishment of valuable commercial ventures.

27. The legislation must at least contain provisions that grant the operator sufficient security to the land and water necessary to enable the fish farm to be established financed and operated over the long term. In addition, because in the fisheries laws of most countries' systems, fish do not belong to any person until they are captured, the legislation must establish that the operator of an aquaculture establishment has the exclusive right to the fish under cultivation within the limits of its facility. A good aquaculture regime should at least deal with the following issues.

28. The fish farmer must obtain a secure legal right to the lands on which the farm is located, either by means of a real property right or through a lease or similar legal instrument. It is sufficient to give the operator a legal right that is sufficiently secure to allow the fish farm to be financed, to flourish over an extended period and to enable other people to be excluded from the property. Where the lands upon which the operations are to be conducted are owned by the state or located in coastal zones or held under traditional systems of tenure, this is of particular importance because a state may have restrictions on the extent to which private ownership rights can be legally granted in such lands.

29. The fish farmer must also obtain a right to an adequate supply of good quality water and be able to protect that supply from the claims of others in accordance with reasonably certain legal rules.

30. Where aquaculture is carried on in cages or in coastal regions, the farmer must have the right to the area of water in which the operation will be located. In the case of fish farms, where the water supply arises entirely on the farmer's property, it is easy to fulfil this requirement in most countries, provided that the source of the water is protected from pollution by others.

31. Where the aquaculture operation receives its supply of water from a river or lake, legislation must ensure that the fish farmer can obtain a secure water right.

32. Moreover, each country must have a water rights law that stipulates clear rules for allocating water in times of shortage. In the absence of modern water legislation, the question of insufficient water in a river to satisfy all users is often resolved by some variation of the doctrine of riparian rights, which essentially shares water between owners of land adjoining the watercourse and prohibits large diversions entirely. Such systems rarely provide aquaculture operators with an assured right to a specific quantity of water and their use of water can often be challenged by riparian owners and other users during times of shortage.

33. In addition to adequate supply, fish farmers must be able to protect their source of water supply from pollution by competing activities. In practice, this requires that each country must have an adequate law for the control of water pollution which can be enforced at the instance of the fish farmer.

34. Aquaculture legislation can impose significant costs on an applicant in acquiring the necessary rights to land and water and the right to carry on the operation, as well as in complying with all environmental requirements. It must be recognised that compliance with regulatory schemes can impose significant costs on operators and that higher costs will deter the development of commercial aquaculture. It is therefore important to investigate means of minimising costs and eliminating the imposition of unnecessary costs while, nevertheless, ensuring that the goals of the environment legislation are achieved.

35. This can occur, for example, by adopting a single window approach for the numerous approvals that are often necessary for an aquaculture operation, screening initial proposals so that only those with the potential for adverse effects on the environment are subjected to an environmental impact assessment, and by creating a single agency whose function is to act as an advocate for aquaculture within government and to monitor the progress of applications for the acquisition of rights and the approval of operations through other government departments.

36. An experienced observer has noted in this regard that even when a country's aquaculture sector is very small, the creation of a single national committee or agency can avoid many of the problems that arise from the fact that policies relating to aquaculture are traditionally divided between a number of government departments.

37. The first step in establishing control over the environmental aspects of aquaculture is to require an operator to obtain a permit or a licence before establishing or continuing a commercial venture. It does not matter whether the document is called a permit or a licence. What is important is for the document to perform the following two basic functions.

38. The permit must provide the government authorities with the legal basis to control all aquaculture operations and to supervise their environmental dimensions. From the viewpoint of the fish farmer, the permit should provide a clear right to operate the aquaculture facility as long as the operator complies with the terms of the permit, the relevant environmental laws and any applicable codes of aquaculture practice.

39. The legislation should place the operation of the permit system in the hands of a specialist agency, rather than one individual, and should avoid leaving decisions to the unfettered discretion of the agency.

41. Because the location of a fish farm at an undesirable site can be disastrous, the suitability of the site is one matter that should be specifically considered by the agency prior to the grant of a permit. This decision on an application for a permit also allows government agencies to integrate the siting of fish farms with plans for the management of coastal zones and lakeshores.

42. As a means of avoiding close examination of every application, the siting decisions can be expedited if certain areas have been designated or zoned in advance as suitable for aquaculture. If this is the case, the decision-maker can focus on the merits of the individual application rather than on the question whether the particular site is suitable for aquaculture.

43. In some cases, the planned location of a proposed aquaculture operation should be examined in an EIA, along with the other environmental effects of the proposal. It is, therefore, important to determine when an EIA is required.

44. When the application for a permit is received, an initial decision must be taken as to whether the project will be submitted to an EIA. The legislation should state explicit criteria for determining whether an assessment is required for a proposed aquaculture project. Because an EIA can impose great expense on the proponent, it should be required only for those projects that create a genuine risk of environmental damage.

45. The criteria for determining whether such a risk exists should focus on factors such as the size of the proposed project, with respect to the maximum carrying capacity of the site, whether the project involves the discharge of waste into sensitive areas, whether the proposal involves exotic or genetically modified species, and whether the project threatens rare or endangered species².

46. Where an EIA is required, the regulator should reflect the results of the assessment in making the decision whether, and under what conditions, to grant a permit.

47. Where an EIA is not required, the decision on the application for a permit should be taken according to explicitly stated principles. This decision should not be left to the discretion of an individual official. A fundamental requirement of good aquaculture legislation is that "it is essential that particular decisions about the granting or withholding of development are made against a background of explicit policy principles".

48. A permit may be denied for various reasons. These can include: the prevention of the adverse impact of the proposed operation upon an area of special conservation importance, an over-concentration of installations in a locality to the detriment of other fish farmers, an unacceptable impact on competing water users, and the avoidance of projects that exceed the maximum carrying capacity of their sites.

49. The application for a permit provides an ideal opportunity to deal with any concerns about water quality that may be caused by the aquaculture project. Many inland aquaculture operations operate as a reasonably closed system of ponds and are unlikely to raise serious questions of pollution in public water bodies. However, where there is a risk of discharge from the fish farm, or where operations will be conducted in cages, especially in shallow or confined water bodies, the water quality implications of the proposed activity should be clearly addressed.

50. Either the aquaculture permit or a permit issued under water quality legislation should state the specific requirements for dealing with continuing water quality concerns. However, a fish farmer who operates within the terms of the permit and in accordance with water quality legislation and any applicable codes of practice should have a complete defence against claims relating to water pollution.

51. The review of the application for a permit also provides the opportunity to apply national policies relating to the introduction of non-indigenous species or genetically modified species as well as trans-boundary movements of aquatic animals. Ideally, the governing legislation will prohibit the introduction of exotic or genetically modified organisms without approval, and the permit process provides a further opportunity to ensure that such a policy is observed. Where the proposed use of such species is controversial, the approval process can make provision for an environmental impact assessment of this aspect of the application.

52. The permit process is closely linked to the effective enforcement of rules relating to the conduct of aquaculture operations. In an ideal scheme legislation, accompanied by more detailed regulations, sets out the general standards for the conduct of aquaculture projects. Permits contain more detailed rules that are specific to the individual site or operator. Sound legislation makes it an offence to breach any of the rules established in the legislation, the regulations or the permit and stipulates the applicable penalties that will apply.

53. Frequently, this type of legal regime is supplemented by Codes of Practice or Technical Guidelines, which are not normally legally enforceable, but which guide the conduct of aquaculture operations. These Codes of Practice can be quite effective in appropriate circumstances, for example, where they are required under the terms of trade agreements or supported by buyers who require proof of compliance before proceeding with their purchases.

54. Codes of Practice and Technical Guidelines also allow governments to address a problem which exists throughout the world and which causes particular difficulties in developing countries. Limited budgets can mean that regulators are not equipped to insist on the proper standards for aquaculture operations.

55. One method of ensuring that proper standards are required of fish farmers is to include a requirement that operations must be conducted in accordance with established Codes of Conduct or Technical Guidelines. Ideally, this requirement should be contained in the governing legislation or regulations, so that the applicable rules are available to all. The requirement can also be imposed as a condition of a permit while more detailed legislation is in the course of preparation.

56. It is recognised that there needs to be sensitivity in ensuring that guidelines are suitable to the individual country and to its development needs, but this danger is reduced as more guidelines specific to individual regions are developed. Once that has occurred, a great deal of administrative resources can be saved if applicable codes of conduct are incorporated by reference in the rules that apply to individual operators.

57. It must be emphasized that it is not sufficient for a country merely to adopt a Code of Conduct to govern the conduct of aquaculture operations. If the Code of Conduct is intended to take the place of detailed rules of operation, it must also be given the force of law. This can be accomplished if the Code of Conduct or Technical Guidelines are incorporated by reference into domestic regulations, together with appropriate penalties in the event of that their requirements are breached.

58. Because even a perfect regulatory scheme will be undermined if there is no assurance that its provisions are observed, the problem of enforcement must be addressed. In enforcement, there is no substitute for the establishment of an appropriate inspectorate with adequate powers of inspection and a well thought out system of sanctions, but the administrative burden can be lightened if it is supplemented by the permit system. At least, conditions can establish the kinds of information that permit holders are required to maintain and provide upon request to regulators.

59. Sub-Saharan African countries have to adjust their role, responsibilities and activities from time to time to meet the evolving challenges in the development of sustainable commercial aquaculture. The emphasis must change and countries should work towards being equipped with laws and institutions which recognise the unique issues that arise in aquaculture and which encourage its responsible development.

60. In adjusting their responsibilities, either a legal framework specific to aquaculture will have to be put in place or an existing legal framework will have to be reviewed and eventually amended.

61. One way or another, there will be a need to shape the legislation in the light of a country's own legal and institutional environment and the particular problems it faces. Such new legislation or amendment process should not fall short of providing the country with both a commercial aquaculture development role and an environment protection role.

62. It is recommended that governments in the region give increased attention to sustainable commercial aquaculture development and endeavour to strengthen the legal framework for such aquaculture development and the institutional capacity, taking into account the legal heritage and the suggestions expressed in the present paper and the document FI: SCA/2001/Inf.5.

63. This Consultation draws the attention to relevant issues implicating sustainable commercial aquaculture development. In relation to the legal issues, countries could recommend more specific and pragmatic assistance with clear objectives and seek cooperation and support from international and regional or sub-regional bodies. Such specific and pragmatic assistance in legal matters could take the form of individual technical assistance projects or of joint consultations on how to deal with certain specific issues. The latter option has the benefit that one can learn from each other.

TECHNICAL CONSULTATION ON LEGAL FRAMEWORKS AND ECONOMIC POLICY INSTRUMENTS FOR SUSTAINABLE COMMERCIAL AQUACULTURE IN AFRICA SOUTH OF THE SAHARA

Arusha, Tanzania, 4-7 December 2001

LEGAL, REGULATORY AND INSTITUTIONAL FRAMEWORK FOR THE PROMOTION OF SUSTAINABLE COMMERCIAL AQUACULTURE IN SUB-SAHARAN AFRICA

I. INTRODUCTION

II. WHAT IS SUSTAINABLE COMMERCIAL AQUACULTURE

III. CHALLENGES FACING SUB-SAHARAN AFRICAN COUNTRIES

IV. A CONDUCIVE LEGAL FRAMEWORK

VI. SUGGESTED ACTION BY THE CONSULTATION