25th Apr 2018


EU subsidies fuel Spain’s ravenous fleet

  • Hake is Spain’s most popular fish. The average citizen eats more than 4 kilos per year. (Photo: Mar Cabra)

Published in partnership with the International Consortium of Investigative Journalists

Decades of overfishing have left Europe’s fish stocks in peril and its fishermen in poverty. It’s an impasse paid for by EU taxpayers. Yet a proposed revision of the EU’s fishing law, hailed as sweeping reform, is rapidly losing momentum.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

  • The northwestern region of Galicia more than anywhere else in Europe relies on fishing to stay afloat. Around half of the Spanish vessels are based in this region. Here, unloading fish at the end of the day in the port of Riveira. (Photo: Mar Cabra)

A look at the industry’s biggest player - Spain - shows what officials are up against. Billions of euros in subsidies built its bloated fleet and propped up a money-losing industry. All the while, companies systematically flout the rules while officials overlook fraud and continue to fund offenders, an investigation by the International Consortium of Investigative Journalists has found.

“Spain has earned its bad reputation,” said Ernesto Penas Lado, director of policy and enforcement at the European Commission’s Directorate-General for Maritime Affairs and Fisheries. “The problem is others don’t have the reputation and deserve it just as much.”

Spain may not be alone. But as the EU’s most powerful fishing fleet, it is the starkest example of a failed EU policy, critics say.

The Spanish fishing industry has received more than €5.8 billion (more than $8 billion) in subsidies since 2000 for everything from building new vessels and breaking down old ships to payments for retiring fishermen and training for the next generation, an fresh analysis by ICIJ shows.

Subsidies account for almost a third of the value of the industry. Simply put, nearly one in three fish caught on a Spanish hook or raised in a Spanish farm is paid for with public money.

ICIJ’s analysis is the first in-depth look at just how much public aid Spain has received for fishing - primarily from EU taxpayers, but also from Madrid and regional governments. The country has cornered a third of all the EU’s fishing aid since 2000, far more than any other member state. The central government doles out even more for things such as low interest loans and funding for its largest industry associations, which in turn lobby the EU for more industry subsidies, records show. Since 2000, the sector has avoided paying €2 billion in taxes on fuel to the Spanish Treasury.

Public monies also fund a surprising range of services. More than €82 million ($114 million) has been spent to promote the fishing sector through advertising and at trade shows. After fishing vessels were hijacked by pirates in the Indian Ocean, Spain in 2009 changed its law to allow vessels to hire private security forces onboard, and then it helped foot the bill to the tune of €2.8 million.

The root of the problem, regulators say, is that out-of-control subsidies encourage countries to build up already oversized fleets that are rapidly depleting the seas.

“Fish are not an unlimited resource,” said fisheries economist Andrew Dyck of the University of British Columbia. “When the public purse is the only thing propping this industry up, we are paying for resource degradation.”

The EU Commission itself recently concluded that “too many boats continue to chase too few fish.” It blamed the situation, in large part, on subsidies.

Fish, not human rights

One of the most controversial forms of public aid pays for foreign fishing licences. With its own waters increasingly empty of fish, the EU buys rights to the fishing grounds of developing countries such as Morocco, Mozambique and the Ivory Coast.

Green groups, fishing experts and some EU politicians have criticised the agreements, saying European fishermen take advantage of poor countries that often lack knowledge and resources to protect their fish stocks. And key agreements cost more than they return on the value of fish. This is the case with Morocco, where each euro invested returns only €0.65 in value added, according to a study funded by the EU.

The Spanish industry has received more than €800 million ($1.15 billion) in foreign licenses over the past decade — about two-thirds of the EU licences overall, according to the ICIJ analysis.

The agreements have the support of Carmen Fraga Estévez, the European Parliament’s most powerful legislator on fisheries issues. A sharp-tongued politician with an encyclopedic knowledge of the industry, Fraga served as fishing secretary in Spain and has held a seat in the parliament’s committee on fisheries - which she now chairs - for 17 years. Her loyalty to the industry appears to be so deep that when she had to choose between human rights and fish, she voted for the latter.

“The fisheries committee has to discuss fisheries issues, not human rights,” she was quoted in the press as saying when in 2009, the committee for the first time voted down a fishing agreement. Days before the vote, 157 civilians died after Guinea’s totalitarian regime opened fire on pro-democracy protesters. The agreement would have handed the Guinean government €450,000 ($639,000) a year for fishing licences.

Fraga Estévez declined requests for interviews from ICIJ.

Spanish member of the European Parliament (MEP) Josefa Andrés Barea said the subsidised foreign fishing licences are vital. When Spain entered the EU in 1986, very few Spanish vessels were allowed in the Union’s waters. So fishing in foreign waters was - and still is - the only way for many ship owners to make a living. And if Spain isn’t fishing, she said, less savory global players will scoop up the catch instead.

"There's a fundamental problem here, which is that major [fishing] powers like China will be there if we're not. And they don't have any rules,” Andrés said. “They're much more predatory than we are."

Fewer fish, poorer fishermen

EU waters are among the world’s most exploited. Scientists say three quarters of assessed fish stocks are overfished. Eels once served as a delicacy are so depleted scientists doubt they can recover despite a Europe-wide rescue plan. Irish Sea Cod, Baltic Sprat and West of Scotland herring are all dwindling.

The trend stretches across the globe. In 2006, the UN’s Food and Agriculture Organization estimated that 75 percent of the world fish stocks were fished to the very limit of - or beyond - sustainable levels. In its latest report, from last year, that figure had risen to 85 percent.

“Europe has a long and dark history of overfishing,” said Boris Worm, one of the world´s most renowned marine biologists, working at Dalhousie University in Nova Scotia, Canada. In a 2003 study, Worm showed that industrialised fishing has, since 1950, emptied the oceans of nine out of 10 fish longer than 20 inches such as salmon, cod and halibut.

Fewer fish mean fewer - and poorer - fishermen. Across the EU, the sector often costs taxpayers more than it produces. According to a recent report by the environmental group Oceana, at least eight countries received more money in public fisheries aid in 2009 than the value of their landed fish.

The fishing industry was the only segment of Spain’s economy that shrunk in the 2000s. The northwestern region of Galicia more than anywhere else in Europe relies on the industry - and the subsidies - to stay afloat. Yet the area lost a third of its fisheries-related jobs in the decade leading up to 2006.

In the Galician port of Vigo on the Atlantic coast, more fish pass across the docks headed for consumers’ plates than in any other port in the world. Coastal towns are riddled with signs boasting subsidised fishing projects. Politicians include the sector as a central theme in their campaigns.

The industry’s power was propelled by the 1960s push for industrialisation by the fascist Franco regime. Franco himself was an avid fisherman and a Galician by birth.

“Economically the [fishing] industry is between the tomato and the potato. But politically it is more important than any other industry,” said EU’s head of fisheries control Valérie Lainé. The sector “has always been protected by the government - without the industry, Vigo would be dead, Galicia would be dead.”

The powerful Galician industry group ARVI, which boasts of its close ties to lawmakers, acknowledged that fishing would not be viable without public funding. In a recent position paper, it encouraged politicians to support subsidies to modernise outdated vessels, fish in foreign waters and build new on-shore cold storage.

Meanwhile, subsidies steadily flow to the region, but sometimes only make things worse.

Víctor Muñiz has relied on fishing for decades. He used to own vessels, as did his father before him. Not anymore. Now they operate a fish processing plant in the Galician town of Meaño. The factory was renovated in 2009 with EU subsidies to process and freeze up to 300 tons of fish per hour; it was expected to employ 100 people. But the brand new machinery stands silent.

“There should be 10 trucks with mackerel here,” Muñiz said in a bitter tone as he walked through the 8,000 square meter plant in April. But within 20 days of the start of the season, most vessels had already scooped up their entire mackerel quota.

Muñiz said the quota is too low, but his major frustration is that too many factories like his were subsidised in the first place.

“You present a €2 million project, and they give you 60 percent. You’ve told them how much fish you're going to produce and what kind. Somebody should have told the processing plants: ‘No, sorry, this is the quota for mackerel.’”

Policy in a shambles

By 2006 it was clear that EU’s fishing policy was in a shambles. Fleets were bloated. Stocks were crashing.

Researchers commissioned by the EU drafted a series of reviews of the community’s fisheries law - the Common Fisheries Policy, which will govern the fleet for at least a decade. One little-known document is informally called the “Frankenstein report” because of its damning conclusions. It lays the blame squarely on influence-driven subsidies: The sector would be broke without them.

Swedish Green Party MEP Isabella Lövin said the key problem of the EU fisheries policy is that it was “modeled after agricultural policy. You provide fertilizer and farming equipment, you get more vegetables. So they used the same model in fishing - you increase the number of boats, you get more fish. But it doesn’t work that way,” she said. “You end up with less fish.”

Subsidies over the past decades built a bloated EU fleet that plundered fish stocks. Efforts to reduce the capacity have focused on paying companies to break down old vessels. But that reduction has been undercut by subsidies given to modernise existing vessels, enabling them to catch more and more fish.

According to the 394-page “Frankenstein report”, EU-countries need to cut capacity in half and severely restrict - and adhere to - quotas for fish stocks to recover.

But Spanish Fishing Secretary Alicia Villauriz said policymakers must consider more than capacity. “You cannot make a statement saying: If you reduce the fleet everything will be more profitable. You'll also destroy a lot of employment.” Any transition, she said, would need to happen slowly.

That the European fleet was bloated was nothing new - calls to cut it down began in the 1980s. But the aid kept rolling in to build new ships and modernise old ones. “The sector has managed to attract more financial resources than would be justified under normal conditions,” the “Frankenstein” report said.

The EU researchers also found that groups set up to advise the Commission on a new fishing policy - largely made up of industry representatives - consider the platform “mainly as a channel for political influence, and secondly as a forum for discussion” of the new law.

In short: They were lobbying for their interests instead of trying to find solutions.

The EU-commissioned “Frankenstein” report concluded that EU policy did “not provide the right incentives for responsible fishing, or may even induce irresponsible fishing.”

Turning a blind eye

Protected stocks worth as much as €16.7 billion ($23 billion) are illegally traded worldwide every year - making the black market in fish more valuable than smuggling stolen art. Many of the players in the illicit trade set up shell companies in places that do not adhere to international conventions protecting the oceans.

Spanish nationals register more vessels to “flag-of-convenience” countries than any other besides Panama, Honduras and Taiwan - which are themselves considered nations where a ship-owner can register their boats without having to adhere to strict tax or safety requirements, and can operate without oversight.

It is rare for the commission to take a member state to court. The European Court of Justice - Europe’s highest court - has found Spain guilty three times of failing to implement EU fishing laws. Spain has refused to enforce catch limits, police its fleet or impose adequate punishment, the court ruled.

One of Spain’s most widely criticised shortfalls is policing its port of Las Palmas on the Canary Islands off the Moroccan coast. Illegal shipments of fish plundered from West African waters regularly filter into the EU through the port, according to multiple investigative reports.

Fishing secretary Villauriz said control in Spain is expensive because of the sheer size of its industry - more than 10,000 fishing boats, 3,084 miles of coastline and 47 major ports. “But that doesn't mean we're not taking care of our obligations in control matters” she added.

The Spanish Ministry of Environment, Agriculture and Fisheries told ICIJ that inspections have nearly doubled since 2004 to 9,323 in 2010. That’s still far from the number of inspections other countries are carrying out - the United Kingdom logged nearly 50,000 inspections in 2004.

But some things don’t appear to have changed. The number of inspectors in the port of Vigo - Europe's largest fishing port - remains the same as in 2003, when EU officials blasted Spain for the measly number of national inspectors at its ports. Today four inspectors oversee more than 700,000 metric tons of fish a year - that’s nearly 20,000 kilos of fish per inspector for every hour of every day of the year, including Christmas.

Subsidised offenders

Spanish officials, like those in many other EU countries, do not take into account whether its nationals have been involved in the illegal fishing trade before doling out public aid.

Neither Spain nor the EU will make public information about offenders who have been fined for illegal fishing - also called Illegal, Unreported and Unregulated fishing (IUU). But a sliver of insight can been gleaned from a database of appellate court rulings. ICIJ reviewed every court case adjudicated since 2000 in which subsidised companies unsuccessfully appealed fines imposed by the Spanish government. In more than 80 percent of cases in which the appellant could be identified, firms continued to receive subsidies after the court had upheld penalties, the analysis shows.

There’s only one case in which the ministry of fisheries tried to prevent a company from receiving subsidies, according to ministry officials.

That Spanish ship-owner so exemplifies the quagmire as to make it a near cliché. Government officials and international regulators have repeatedly targeted Vidal Armadores for its alleged involvement in a decade-old international network of pirate fishing vessels, court and law enforcement records show. Brussels demanded multiple times that Spain recover subsidies and “take action against” Vidal Armadores. At least through 2010, however, Spain and the EU continued to pay the firm — at least €8.2 million ($12 million) since 1996. Last year the government finally fined the company and cut off aid, but the case is pending appeal.

In an interview with ICIJ, one of the firm owners, Manuel Antonio Vidal Pego, denied allegations of illegal fishing and said the company was entitled to the subsidies it received.

Like Vidal Armadores has in the past, seafood giant Pescanova targets Patagonian toothfish - sold in the US as Chilean sea bass. Unlike Vidal Armadores, Pescanova is a member of an association that fights illegal fishing. In Spain, it boasts a trusted motto: “Lo bueno sale bien,” translated as “Good things go well.” But the company has its own troubles.

Last year, Pescanova’s US subsidiary pleaded guilty to illegally importing $1.2 million worth of toothfish. While that case — nicknamed “Operation Toothless” — was pending, the US Department of Justice launched a second investigation into another allegedly illegal importation. The status of the second investigation is unknown.

Pescanova is one of the Europe’s three largest seafood companies, with a fleet of around 100 boats fishing worldwide and annual sales of €1.53 billion (more than $2 billion). Yet, since 1995 the company has pulled in more than €175 million ($250 million) in subsidies, according to the ICIJ analysis.

Pescanova repeatedly declined requests for interviews from ICIJ. “We've had 50 years of positive history,” said spokesman Angel Matamoro during a brief phone exchange. “I don't think you're asking about themes that will promote our image.”

Regarding the US investigations, he said, “Whatever we had to say, we said it to the US court. The company follows scrupulously the law in every country it’s in.”

One firm that broke the law and continued to receive aid is Albacora, one of the largest tuna companies in Europe. The company’s boat Albacora Uno last year was fined $5 million - the largest fine in US history - for illegally placing fishing gear in US waters multiple times during a two-year period. The boat was built with subsidies and used subsidised fishing licenses. And even after the US fined the firm, Spain granted Albacora €1.8 million ($2.6 million) worth of subsidies to fish in foreign waters.

The Spanish ministry of fisheries told ICIJ it had fined Albacora but will not deny the company further aid.

Albacora director Jon Uria said the 67 infringements were an “isolated” incident. The company was unaware of the infractions, he said, until the US government alerted executives. In his view, the fine was disproportionate to the offense.

A radical reform?

Javier Garat is the Spanish industry’s most visible and eloquent lobbyist. He was born into the family that co-founded Albacora. Garat is now a shareholder of the company, but he says that does not influence his lobbying.

In his meetings with officials, he often requests subsidies for the sector. “That money has generated wealth,” he said. “It’s been used to modernise an obsolete fishing sector” so that today “we have better, more modern, more secure vessels.”

Garat heads Spain’s powerful lobbying group Cepesca as well as the Europe-wide industry group Europêche — both of which operate with EU subsidies. In the halls of the ministry of fisheries in Madrid, the word is that Garat will be appointed Spain’s next fishing secretary following the November elections.

Following closed-door meetings at the ministry in April, Garat and Spanish Minister of Environment, Agriculture and Fisheries Rosa Aguilar announced that the ministry and Cepesca were devising a “common roadmap to defend Spanish interests” in the overhaul of the EU fishing policy.

After two years of deliberation, the European Commission presented its proposed legislation in July. No one but the commissioner herself appears satisfied with the draft. But the negotiations have just begun. Political alliances and lobbying will determine the final language to be voted upon before the law goes into effect 1 January, 2013.

Garat called the reform draft “cowardly.” He said the commission succumbed to pressure from environmentalists and biased media “without taking into consideration the repercussions on the fishing sector.” In his view, the state of the fish stocks is not as “catastrophic” as commission officials appear to believe.

Yet it seems the industry’s efforts have staved off its worst nightmares.

Nothing came of ambitions to make overfishing a crime, as happened in the US under the Magnuson-Stevens Act, or to require quotas be consistent with what scientists say is biologically sustainable. There was no proposal on how to limit the oversized fishing fleet or to implement quotas in the fishing agreements with foreign countries.

EU’s top fisheries official, commissioner Maria Damanaki, told ICIJ her proposal is “radical.” She said Brussels will stop directly subsidising the industry. “Now we are going to give money in a very prudent way and under very strict conditions,” she said. “And we are going to ask for paybacks in the case of illegal fishing.”

Damanaki also highlighted proposed changes in the fishing partnership agreements. “We are going to call them sustainable fisheries agreements because we're going to fish only for the surplus — if there is any surplus,” she said. “Also, we're going to respect human rights in these areas.”

Given the hype, Green party MEP Loevin said, “I had expected a clause on human rights.” But the human rights clause originally in the legislative text was missing from the final proposal.

Loevin ran for office on a ticket pledging to change the fishing policy. She said the proposal is a lot less radical than she had hoped - especially as the coming negotiations will water it down even more. “The law can't allow for politicians to compromise with the environment when long-term environmental goals clash with short-term profit,” she said.

Ernesto Penas Lado, director of the European Commission’s fisheries policy unit, said the mindset in Spain and among fishing nations globally is that no single country feels responsible for the fate of the fish in the sea.

“It’s the tragedy of the commons,” he said. “Because the resources belong to no one, they belong to everyone.” In the EU, 27 countries have to come to a consensus on a common fishing policy. There’s no mentality of making a sacrifice for preservation, Penas said. “People think: Whatever I do not fish, my neighbor will.”

David Cabo (Spain) and Fredrik Laurin (Sweden) contributed to this story. To read more stories in the series visit ICIJ here


EU's new fisheries policy: throwing a lifeline to the oceans.

European consumers eat nearly twice the fish that our oceans can provide, our over-subsidized fleet is too big, too powerful and not selective enough, writes Xavier Pastor ahead of the talks to reform the Common Fisheries Policy.

New EU policy aims to reduce overfishing by 2015

In a frank admission that the current EU fisheries policy is "not working", the responsible commissioner Maria Damanaki on Wednesday unveiled a new set of measures aimed at reducing overfishing by 2015. Environmental groups are sceptical that the plan will work.

EU signals 'zero tolerance' against illegal fishing

The European Union has said a new system of fisheries control is finally in place, an attempt to stamp out the illegal fishing which contributes to the fragile nature of the bloc's fish stocks.


The fishy bail-out

For the first time the EU will provide funding specifically for Marine Protected Areas, giving fishermen a role in monitoring and managing them. Xavier Pastor of Oceana Europe analyses the new European Maritime and Fisheries Fund.


More commitment to renewables from Council, please

More and more consumers are likely to invest in solar panels in the future as it becomes simpler to produce one's own electricity, writes Monique Goyens, director general of BEUC, the European Consumer Organisation.

News in Brief

  1. UN expects over $4bn in pledges for Syria
  2. Commission wants more public data made available for reuse
  3. Study: Brexit will hit all European farmers
  4. European media face rise in 'verbal violence' from politicians
  5. Greenland PM to keep power despite poll slump
  6. Commissioner optimistic on FYROM name solution
  7. Italian court keeps NGO migrant rescue boat docked
  8. German Jews warned not to wear skullcap in public

Stakeholders' Highlights

  1. Sustainable Energy Week 2018"Lead the Clean Energy Transition"- Register and Join Us in Brussels from 5 to 7 May
  2. EU Green Week 2018Green Cities for a Greener Future. Join the Debate in Brussels from 22 to 24 May
  3. Nordic Council of Ministers12 Recommendations for Nordic Leadership on Climate and Environment
  4. Macedonian Human Rights MovementOxford Professor Calls for an End to the Anti-Macedonian Name Negotiations
  5. ACCAPeople Who Speak-Up Should Feel Safe to Do So
  6. Mission of China to the EUProgress on China-EU Cooperation
  7. Nordic Council of MinistersWorld's Energy Ministers to Meet in Oresund in May to Discuss Green Energy
  8. ILGA EuropeParabéns! Portugal Votes to Respect the Rights of Trans and Intersex People
  9. Mission of China to the EUJobs, Energy, Steel: Government Work Report Sets China's Targets
  10. Martens CentreJoin Us at NET@WORK2018 Featuring Debates on Migration, Foreign Policy, Populism & Disinformation
  11. European Jewish CongressKantor Center Annual Report on Antisemitism Worldwide - The Year the Mask Came Off
  12. UNICEFCalls for the Protection of Children in the Gaza Strip

Latest News

  1. Whistleblowers could be enforcers of rule of law in Europe
  2. EU shelves Macron idea for 'European Darpa'
  3. Don't play EU 'games' with military HQs, Italian admiral says
  4. EU had a plan for Jordan - now it's time to make it work
  5. Time for EU to take charge of global health research agenda
  6. EU in race to set global Artificial Intelligence ethics standards
  7. Juncker delays air quality action due to busy agenda
  8. Spain makes bid for EU naval HQ

Stakeholders' Highlights

  1. Mission of China to the EUForeign Minister Wang Yi Highlights Importance of China-EU Relations
  2. Nordic Council of MinistersImmigration and Integration in the Nordic Region - Getting the Facts Straight
  3. Macedonian Human Rights MovementMacedonians in Bulgaria Demand to End the Anti-Macedonian Name Negotiations
  4. Counter BalanceThe EIB Needs to Lead by Example on Tax Justice
  5. ILGA EuropeTrans People in Sweden to be Paid Compensation for Forced Sterilisation
  6. International Partnership for Human RightsThe Danger of Standing Up for Justice and Rights in Central Asia
  7. Mission of China to the EUChina and EU Must Work Together to Promote Global Steel Sector
  8. Swedish EnterprisesEU Tax Proposal on Digital Services Causes Concern for Small Exporting Economies
  9. European Jewish CongressCondemns the Horrific Murder of Holocaust Survivor Mireille Knoll in Paris
  10. Mission of China to the EUAn Open China Will Foster a World-Class Business Environment
  11. ECR GroupAn Opportunity to Help Shape a Better Future for Europe
  12. Counter BalanceControversial Turkish Azerbaijani Gas Pipeline Gets Major EU Loan

Stakeholders' Highlights

  1. World VisionSyria’s Children ‘At Risk of Never Fully Recovering', New Study Finds
  2. Macedonian Human Rights MovementMeets with US Congress Member to Denounce Anti-Macedonian Name Negotiations
  3. Martens CentreEuropean Defence Union: Time to Aim High?
  4. UNESDAWatch UNESDA’s President Toast Its 60th Anniversary Year
  5. AJC Transatlantic InstituteAJC Condemns MEP Ana Gomes’s Anti-Semitic Remark, Calls for Disciplinary Action
  6. EPSUEU Commissioners Deny 9.8 Million Workers Legal Minimum Standards on Information Rights
  7. ACCAAppropriate Risk Management is Crucial for Effective Strategic Leadership
  8. EPSUWill the Circular Economy be an Economy With no Workers?
  9. European Jewish CongressThe 2018 European Medal of Tolerance Goes to Prince Albert II of Monaco
  10. FiscalNoteGlobal Policy Trends: What to Watch in 2018
  11. Human Rights and Democracy NetworkPromoting Human Rights and Democracy in the Next Eu Multiannual Financial Framework
  12. Mission of China to the EUDigital Cooperation a Priority for China-EU Relations