Report of the Ministerial Inquiry into labour exploitation on Foreign Charter Vessels in New Zealand

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Report of the Ministerial Inquiry into labour exploitation on Foreign Charter Vessels in New Zealand

Posted 15/03/2012 by Dianne Heriot

The Oyang 70 vessel
The New Zealand Government has "resolved to take a stronger line on the operation of foreign charter vessels (FCVs) in New Zealand waters" in response to the Report of a Ministerial Inquiry.  As an earlier flagpost explained, the Inquiry had been convened in response to serious concerns about abuse and exploitation of crew of commercial fishing fleets operating in New Zealand's Exclusive Economic Zone.

Commercial fishing in New Zealand is managed by a quota system, with all fishing quota owned by New Zealand companies.  Foreign Charter Vessels are foreign owned and flagged fishing vessels leased by a New Zealand company to fish in New Zealand's EEZ.  Twenty-seven such vessels (and around 2000 foreign crew) operated in New Zealand waters in 2010-11, flagged to the Republic of Korea, Ukraine, Japan and Dominica.  Foreign Charter Vessels account for approximately 40 per cent of the total commercial harvest under the quota management system; in 2009-10, the approximate total export revenue generated by their catch amounted to some NZ$274.6 million.

The three member Inquiry Panel (headed by Paul Swain, a previous Labour Government Minister of Labour and Immigration) was convened by the then Minister of Fisheries and Aquaculture and the Minister of Labour. The Inquiry took place from August 2011 to February 2012, with the Panel conducting public hearings in Auckland, Christchurch, Nelson and Wellington, and visiting a number of domestic and foreign fishing vessels.  Seventy-two submissions were received (which can be read here on the Ministry of Fisheries website). 

The Inquiry Report states that allegations about crew mistreatment dominated the submissions, including claims of poor vessel safety, human rights abuses and of underpayment of wages.  While it did not investigate specific claims of abuse, the Panel concluded it was clear that a small number of operators of foreign flagged FCVs had been mistreating their crews and disregarding New Zealand laws; and that the response of industry and of government agencies has been inadequate.  (Most of the reported incidents appear to have occurred on a small number of Korean flagged vessels, with the alleged abuse being against predominantly Indonesian crew.) The Report also found that the allegations of abuse and exploitation had damaged New Zealand's reputation, with reports appearing in major international newspapers and online media agencies.  The Panel concluded that major changes and urgent action were required to improve the way New Zealand regulates the activities of FCVs in its waters and made fifteen recommendations, including to

  • improve New Zealand's monitoring and enforcement regime for FCVs (including placing an observer on all FCV operating in NZ waters)
  • improve monitoring and compliance of vessel safety
  • update the Code of Practice and strengthening the migration approval process
  • improve inter agency cooperation
  • amend legislation to enable registration of FCVs to be suspended or revoked
  • extend the application of the Health and Safety in Employment Act for the crew of FCVs.
The effect of these recommendations would be that all who fish in New Zealand's EEZ would be subject to the same minimum standards and rules regarding safety, workplace conditions and fisheries regulations. The Panel's final recommendation was that the fishing industry, including worker representatives, would be involved in developing implementation plans.

In jointly releasing the report on 1 March 2012, the Primary Industries Minister, David Carter, and the Minister for Labour, Kate Wilkinson, stated that the Government accepted in principle and would act on the first six recommendations and would give further consideration to the remaining recommendations concerning legislative amendments, ratification of two key International Maritime Organisation Conventions and key policy changes.  Speaking in Parliament on the same day, Minister Carter stated that departments would implement those recommendations accepted by Government so far within existing resources.  In regard to the remaining recommendations, he said that "the Government wants to understand the wider economic impacts before making any decision on these."  The New Zealand Green Party has criticised the Government for not agreeing to implement all of the Inquiry's recommendations; and Labour's spokesperson for Labour Issues, Darien Fenton, has called for adequate resourcing of departments and a "course of action to address the report in full".

However, early action on the remaining recommendations may be in fact be driven by economic considerations.  In the same week that the Inquiry Report was handed to the New Zealand Government, Bloomberg Business published a lengthy article by Benjamin Skinner, a senior fellow at the Schuster Institute for Investigative Journalism, The Fishing Industry's Cruelest CatchBased on a six month investigation of alleged human rights abuses on fishing vessels operating in New Zealand waters, the article also examines supply chain transparency, a growing area of interest for businesses and regulators in the US and elsewhere.  Effective 1 January 2012, the California Transparency in Supply Chains Act requires large manufacturers and retailers (defined as having at least USD100 million in annual gross receipts) operating in that state to report on specific actions taken to eradicate slavery and human trafficking from their supply chains.  According to Skinner, US retailers Safeway and Wal-Mart "pledged swift investigations" of their suppliers of New Zealand fish to ensure they were "complying with the laws regarding human trafficking and slavery, and ... reviewing their supply chain to insure compliance".  Skinner also reports the CEO of Mazetta Co, reportedly the largest US importer of New Zealand fish, demanding an investigation of labour practices on the FCVs of its suppliers.

(Image source: Oyang 70, Photo by New Zealand Defence Force)
to disclose their efforts to eradicate slavery and human traf


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