Illegal, unreported and unregulated (IUU) fishing hampers the sustainability of the ocean’s precious fish, costing billions of dollars in economic losses each year to governments, coastal communities and law-abiding fishermen, and has an impact considerable impact on the marine environment. Although advances in satellite vessel tracking and legal vessel identification requirements have helped reduce IUU fishing, bad actors continue to exploit loopholes in the system, especially with regard to the ownership of vessels. vessels and who is ultimately responsible for the operations of a fishing vessel.

The legal owner of a vessel is the person or company who has the license and registration documents of a vessel, but this entity usually only receives a nominal payment from the actual owner of the vessel, known as the ultimate beneficial owner (UBO). UBO is the eventual end of the chain of ownership. There are often multiple layers of people and companies between this legal owner and the UBO, and there may be multiple beneficial owners. Authorities and others who track the fishery often find it very difficult to determine who the UBO is, especially in cases, such as IUU fishing, where the person (s) do not wish to be identified.

People who hide their beneficial owners are not necessarily committing a crime, but the opacity of the UBO, which can baffle even the best-trained financial investigators, has helped many perpetrators of IUU fishing escape legal sanctions. And although 83 countries, including the United States, have laws requiring a registry of beneficial owners, this information is not always available to authorities, let alone the public, or even verified when it is submitted. further complicates the investigation and prosecution of illegal fishing.

In many cases, fines or penalties fall on the crew, captain and legal owner of a vessel, rather than the ultimate profiteer. UBO is rarely sanctioned and can often continue to break the law without sanction. And entities that hide their beneficial owners are also more likely to be linked to other illegal acts, including tax evasion and corruption. In an industry in which vessels may fly the flag of one country, be piloted by persons from a second country, and fish in the waters of a third country, impeding beneficial ownership adds even more confusion and creates more confusion. possibilities of illegal activities.

Lack of consistent and transparent rules for beneficial ownership poses additional challenges

Regulations regarding beneficial ownership registers vary from country to country. Of the countries with some type of register of beneficial owners, only 37 require that information on beneficial owners be updated semi-regularly, and only six have some kind of UBO register accessible to the public. The definition of beneficial owner also varies from country to country, with many classifying them as those who own 25% or more of a business, while a few (such as Ecuador) require that a person who owns one or more shares are listed.

However, having a register of beneficial owners does not automatically translate into increased transparency in the fisheries sector. UBO information is rarely, if ever, collected during the licensing or registration process of vessels. This is because property information on the sole legal owner is collected.

Transparency experts around the world advocate for strong beneficial ownership records within the financial regulatory system. But although this is a difficult task for many governments to set up, countries with existing registries can take basic steps to strengthen their regulations and apply them to fisheries management.

First, these governments should require UBO information whenever they issue a flag and whenever a vessel applies for a license to fish in that country’s exclusive economic zone. This UBO information should also be made public through registers and vessel tracking sites. In addition, regional fisheries management organizations should require information from the UBO when authorizing vessels to fish within their borders.

Knowing the ultimate beneficial owner of a fishing vessel is an important part of stopping IUU fishing and helps governments know who benefits from and is legally responsible for fishing in their waters. Existing UBO registers should be expanded and more countries should demand this information and make it publicly available.

With better UBO monitoring, fisheries managers and law enforcement officials can lift the veil on the notoriously opaque fishing industry and reduce the likelihood of illicit activity associated with ownership of the UBO. masked ships.

Peter Horn is the project manager and Gina Fiore is a senior partner in The Pew Charitable Trusts International Fisheries Project.