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Court of Appeal dismisses State aid challenge to fishing regime

27/02/15

On 26 February 2015 the Court of Appeal dismissed an appeal in which three fishermen sought to challenge the UK quota allocation methods on the grounds that they involved unlawful State aid, contrary to Article 107 TFEU.

The fishermen are being prosecuted for alleged overfishing in breach of their licence conditions. Their defence contended that the prosecution amounted to an abuse of process, arguing that the quota allocation mechanisms involve (1) a breach of the general principle of non-discrimination under EU law and/or (2) unlawful State aid. This issue was raised as a preliminary issue.

The fishermen form part of the 10 metres and under fleet and they complained of discrimination as respects the situation of Producer Organisations (POs), which are cooperatives of larger vessels, and vessels forming part of the 10 metre and under fleet. The challenges on both grounds failed following a detailed hearing before the Crown Court. Before the Court of Appeal an appeal was ultimately only pursued as regards the State aid allegation. The appeal was dismissed on two principal grounds:

First, the Appellants conceded below that the “comparability” condition under non-discrimination was similar to the “selectivity” condition under State aid. This concession, and failure to pursue the appeal in so far as concerned non-discrimination, had fatal implications also for their State aid argument. The Court in any event considered the judge’s conclusions on selectivity to be well-founded since the differences between the POs and 10 metre and under vessels were “legion.”
Second the Court of Appeal dismissed the Appellants argument that the differences between the two quota allocation methods rendered POs less likely to be prosecuted and fined for overfishing, which they argued was akin to a State measure selectively exempting the POs from fines. The Court of Appeal distinguished the Commission v Netherlands NOx2 case in this regard.

The Court refused to entertain a new point from the Appellants on the “tradability” of licences.

The judgment is here.

Robert O’Donoghue acted for the Marine Management Organisation (who were the prosecuting body) in the Crown Court and Court of Appeal.