Fisheries Committee on May 8th, 2023

[The Chair, Liberal, Ken McDonald]

Thank you, Madame Desbiens.

There's about 14 seconds left, not much time to get in a question and an answer, so we'll go to Ms. Barron for two and a half minutes or less. Go ahead, please.

[Lisa Marie Barron, NDP, Nanaimo—Ladysmith, BC]

Thank you, Chair.

My question is for Mr. Waddell.

Mr. Waddell, in the next panel we will be hearing from witnesses from Coastal First Nations. Coastal First Nations, as you know, is composed of first nation territories that cover the vast majority of marine areas in the northern waters of British Columbia. All of these nations have ocean-based fishing families and communities that continue to rely on fish, fish habitat and fisheries in their territories for food security, cultural, survival and economic needs.

As you know, these nations, along with Coastal First Nations, signed an agreement, the Fisheries Resources Reconciliation Agreement, in 2021.

Now, I'm trying to pack a lot of information into a very short question, but ultimately what I heard from both the Coastal First Nations, through a letter that was sent to the minister, and other indigenous fishers, through a recent event, Fisheries for Communities, was that corporate and foreign ownership is driving up the prices and resulting in real problems with this agreement and the nations' abilities to meet the needs the agreement was intended to meet.

I'm wondering if you can share with us, please, whether you've had an opportunity to meet with Coastal First Nations and other indigenous nations to implement a fair, transparent and collaborative process to ensure there's a policy in place that works for local communities and indigenous nations.

[Mark Waddell]

At this point in time, Mr. Chair, I have not had an opportunity to meet with Coastal First Nations other than a brief introduction this morning on the margins of this meeting. That being said, my regional colleague does meet with them on a regular occasion.

I would say that this is precisely, Ms. Barron, why we undertook the beneficial ownership survey: so we would have a factual basis on which to make a determination as to the possible extent of foreign ownership.

[Lisa Marie Barron, NDP, Nanaimo—Ladysmith, BC]

Thank you, Mr. Waddell. Perhaps I will also follow up when they are here.

I have just a few seconds left. Can you please share the information that was lacking—that you referred to at the beginning of the meeting—to effectively assess the concerns that have been put forth? You said that there was information lacking. What are one or two things that are missing?

[Mark Waddell]

That was the rationale for which we undertook the beneficial ownership survey. It was because the DFO, at that point in time, did not hold information on the full corporate structure of licence-holders. We undertook the survey to gain that information and to allow us to make informed policy decisions.

[The Chair, Liberal, Ken McDonald]

Thank you, Ms. Barron.

We'll now go to Mr. Bragdon for five minutes or less, please.

[Richard Bragdon, Conservative, Tobique—Mactaquac, NB]

I'll defer my time back over...to Mr. Arnold, I believe.

[Mel Arnold, Conservative, North Okanagan—Shuswap, BC]

Thank you. I wasn't quite ready, but I will be.

We spoke about the vessel licence ownership and the fishing licence ownership. Ms. Mooney or Mr. Waddell, can you speak to the challenges that the vessel owners are facing when they are forced to pay prices per pound per quota at the beginning of a season, not knowing what the actual sale price will be? How are you working to address that issue that we hear about on the west coast?

[Mark Waddell]

If I may, Mr. Chair, I might defer that question to my regional colleague, although that might be one that we would struggle with, admittedly.

[Neil Davis]

I think the department's focus on the west coast has really been about trying to achieve those conservation and economic viability objectives for the fishery. In terms of our role governing what arrangements fishers might make with others who hold quota that they want access to, it has largely been left for them to negotiate arrangements that will work in their best interests. I think some of your witnesses later today may have some really interesting insights with regard to that.

[Mel Arnold, Conservative, North Okanagan—Shuswap, BC]

Thank you.

Perhaps you could also explain why there was such a delayed response to the FOPO report that was tabled in May 2019. This is now four years later, May 2023, and we're really only hearing of just very preliminary steps in addressing the inability of, basically, anyone to track down who the beneficial owners are of the licences and quotas on the west coast.

[Neil Davis]

We actually have been working quite actively since the committee's report to respond to the recommendations. I think we were quite explicit from the outset that we saw that happening in a staged way, because there were so many recommendations, a number of which were quite complex and complicated to address. Since the committee's report, we have taken immediate steps to respond to some of the recommendations and to set ourselves up for engagement on the balance. For example, we have implemented some new surveys to collect additional socio-economic data about the fishery that, as my colleague Mark Waddell was alluding to with respect to the beneficial ownership survey, will give us a more informed basis for discussion.

We have—

[Mel Arnold, Conservative, North Okanagan—Shuswap, BC]

Our time is quite limited here. Thank you.

Could you table the steps you have taken so far, so it can be part of the study as we move forward—to make sure that we're making the best use of our time here?

We have heard from harvesters on the west coast that you started to, basically, dismantle the existing system by allowing the unmarrying of licences held by vessel owners. However, you did that without putting in place any steps to ensure who those licences were being sold to or to track the actual beneficial ownership. Can you explain why you did that? Have you done anything to change that?

[Neil Davis]

We've made a number of attempts over the years to engage different fleets regarding some of the rules that govern their fisheries: marrying, licence stacking.... These provisions vary from one fishery to the next, so it matters which fishery we're talking about. Generally, we have used our engagement and consultation process to implement changes where we have a certain breadth of support for doing so. There are some fisheries in which marrying and stacking are a part of the history of the fishery, but we have changed the way we manage the fishery so that those aren't necessarily measures we need to achieve our conservation objectives. Therefore, we are open to changing them if they provide the fishery with more flexibility.

However, if we don't encounter enough support for making those changes, we have, generally, been sort of reluctant to make changes, because they have financial implications for the harvesters who are participating in those fisheries.

[Mel Arnold, Conservative, North Okanagan—Shuswap, BC]

Have you reversed any of those processes since we first heard about the unmarrying of licences and the failure to track beneficial ownership?

[Neil Davis]

I'd need a bit more specificity to provide you a good answer, but as I said, we would ensure that we were going through the appropriate engagement process to make any sort of policy changes with respect to how we—

[Mel Arnold, Conservative, North Okanagan—Shuswap, BC]

Perhaps we'll hear more from the harvesters when they appear.

Thank you.

[The Chair, Liberal, Ken McDonald]

Thank you, Mr. Arnold.

We'll now go to Mr. Morrissey for the remaining four minutes, please.

[Bobby Morrissey, Liberal, Egmont, PE]

Thank you, Chair.

I want to follow up on the line of questioning from Mr. Kelloway, because the east coast and the west coast are two very different dynamics.

On the east coast, under owner-operator, can either Mr. Waddell or Ms. Mooney clarify who can hold financial security on an inshore licence?

[Mark Waddell]

It's either a Canadian individual or an individual or a company wholly owned by a Canadian, and again, there are residency requirements to ensure that those provisions are—

[Bobby Morrissey, Liberal, Egmont, PE]

If I wanted to go and buy from somebody and I'm the fisher, to arrange financing, at one time there was no security allowed on the licence, but that was changed under owner-operator to allow new entrants coming into the fishery to use the licence for security for a financial institution.

Can you expand on who is legally able to hold security on an inshore fishing licence for financing purposes?

[Mark Waddell]

Thank you, Mr. Chair.

You're correct on that. Registered financial institutions are able to—

[Bobby Morrissey, Liberal, Egmont, PE]

It's only registered ones, so only chartered banks, credit unions and government lending agencies can hold security....

Why I'm going to this is that there would be an issue if we allowed corporate fish processing entities to extend financing to a commercial fisher to acquire a licence, because then you're getting into the grey area of controlling where the product goes.

[Jennifer Mooney]

Perhaps I can add to that.

Yes, licence-holders can obtain financing from both registered and non-registered financial institutions, and licence-holders—

[Bobby Morrissey, Liberal, Egmont, PE]

Non-registered financial institutions...?