Russia’s war against Ukraine: Support for the seafood sector using leftover 2014-2020 budget

Written by Frederik Scholaert.

The Russian war against Ukraine has led to high operating costs for the seafood sector. In late March 2022, the EU responded with temporary State aid and exceptional support for the current programming period under the European Maritime, Fisheries and Aquaculture Fund (EMFAF). On 23 April 2022, the Commission adopted a new proposal amending the fund for the 2014-2020 programming period, so that its remaining budget can also be used to support the sector. During the July plenary session, Parliament is due to vote on its position on the file.

Background

The Russian war against Ukraine has significantly affected fishermen, aquaculture farmers and fish‑processing companies. In particular, increased energy prices threaten the profitability of the fishing industry. The monthly marine gasoil price increased from about €0.60 per litre in January 2022 to €1.00 in May 2022. While the EU sanctions do not include a ban on seafood trade, with the exception of some luxury seafood products, trade flows have been severely hampered, especially for EU fish-processing companies that rely on supplies of whitefish from Russia. In addition, Black Sea fisheries face a direct security threat.

First package of measures

In March 2022, the Commission adopted a package of measures to support the economy in the context of Russia’s invasion. Temporary State aid rules allow fishery and aquaculture companies to receive up to €35 000 in aid, and all companies affected by the crisis to get liquidity support and compensation for the high energy prices. In addition, the Commission triggered the EMFAF Regulation crisis mechanism, by declaring an event causing significant disruption to markets. This allows Member States to compensate operators for lost income or additional costs and producer organisations for the storage of fishery products.

Commission proposal

On 13 April 2022, the Commission adopted a new proposal to amend the European Maritime and Fisheries Fund (EMFF) – the predecessor of the EMFAF – which covered the 2014-2020 programming period. This would allow the taking of similar emergency measures to those activated under the EMFAF, namely financial compensation for additional costs, for income forgone and for the storage of products. Temporary cessation of fishing activities would be supported where they are currently unsafe. The proposal comes in the form of an amending regulation, as the EMFF does not contain a crisis mechanism to trigger emergency measures in the event of a crisis.

European Parliament position

Given the urgency of ensuring aid to the sector, Parliament’s Committee on Fisheries (PECH) acted quickly on the legislative proposal. On 20 June 2022, PECH unanimously adopted its report on the file, in which it proposed extending support for temporary cessation to all fishing activities where economic viability is impeded. As the PECH report is aligned with the position of the Council, no interinstitutional negotiations will be needed. The text is scheduled to be voted in plenary in July 2022.

Read this at a glance on ‘Russia’s war against Ukraine: Support for the seafood sector using leftover 2014-2020 budget‘ in the Think Tank pages of the European Parliament.