Salmon Regulation Assessment

The research project SaRA (Studies of Regulatory Regimes in Aquaculture) has studied the licensing system for aquaculture production in Norway. The project was led by Tonje C. Osmundsen at NTNU Social Research. Marit Schei Olsen, Vilde Amundsen and Asle Gauteplass also participated from NTNU Social Research. Research partners were NOFIMA (with Bjørn Hersoug, Roy Robertsen, Kine Karlsen and Eirik Mikkelsen), IRIS with Ragnar Tveterås, Univ. of Stavanger with Sigbjørn Tveterås and Univ. of Florida with Frank Asche. Fabian Rocha Aponte has completed his PhD work in the project from the Univ of Stavanger. In SaRA, the researchers have studied both the ordinary licenses for aquaculture, licenses for special purposes (research, broodstock, education, exhibition and development), and the development and implementation of the traffic light system and production areas. Together, these schemes represent various attempts to regulate access to produce salmon in Norway, and have had a major impact on where and who will produce salmon, and not least on how much will be produced. From 1973 until today, there have been five different rounds of awarding ordinary, or so-called commercial permits, for salmon farming. In many of these rounds, district policy considerations were emphasized. Increasing activity in the northernmost counties was seen as particularly important. In retrospect, it is clear that despite political signals to prioritize small businesses, municipalities with little fish farming, women, Sami interests, and in recent years environmental considerations, the follow-up of such conditions in the permits has been limited. We see this most recently in the follow-up of the green permits that were granted in 2013. In addition to the ordinary licenses, a number of special licenses have also been established in the same period. These have been established for various specific purposes, and have been awarded without a remuneration fee. As is well known, the latest scheme with development permits will cost NOK 10 million, but only upon conversion to ordinary licenses. The special licenses have gradually become numerous, and now represent 20% of the total permitted biomass. The many different purposes that the licenses cover are important both for the industry and society in general, but the number and amount of biomass these include is currently much larger than what was originally expected. In recent years, the authorities have tightened the follow-up of special licenses, and changed the conditions, especially in the form of time limits. In 2021, a temporary break in the allocation of such permits has now been established, and fundamental changes to the system will be considered. The SaRA project has also looked at the financial conditions of this system, and studied, among other things, the impact of the MTB system on different companies. In his dissertation, Rocha Aponte analyzes the relationship between market organization and public regulation in nature-based industries, with salmon farming as the empirical case. He shows, among other things, the extent to which size measured as number of licenses and permitted biomass is important for the ability to utilize economies of scale. In summary, we see that despite the fact that the licensing system has survived for over 50 years and various governments, the system has weaknesses, especially in terms of administrative costs, and the need for thorough administrative follow-up of what has become a very complicated system. Historically, it has proved very difficult to follow up on the many different terms and conditions of the licenses. Whether it will change in the future, for example with regard to development licenses, remains to be seen. In particular, the requirement to inform and disseminate information from the projects that will benefit the industry as a whole is an important follow-up point, in addition to how to assess goal achievement before conversion. The special licenses have increasingly been converted into time-limited licenses, which gives the authorities greater control in that the need for the license must be legitimized through applications for renewal. Whether ordinary licenses should also have some form of time limit is, on the other hand, little discussed. The permits have become very valuable, estimated at 170 million for an ordinary license (780 MTB) per. August 2020. In practice, there are few or no opportunities for new players to enter the sector, and strong consolidation means that the 10 largest companies now control 70% of production. A main reason for this development is the license system as it has been practiced. An important question is whether this is a development that is in the best interests of both society and the industry. Many of these questions are more thoroughly elucidated in the many different publications from the project: amounting to 13 scientific articles, additional 5 articles in review, and 50 media contributions.

SaRA har satt søkelys på helt sentrale reguleringsmekanismer i den norske forvaltningen av laksenæringen. Historien om hvordan reguleringsregimet har endret seg er også historien om utviklingen av norsk lakseoppdrett og dens rolle i det norske samfunnet. Det norske forvaltningssystemet blir ofte sett på som en gullstandard for andre lakseproduserende nasjoner. Det er allikevel ikke slik at andre har adoptert våre løsninger i form av ulike typer lisenser, eller har gjort endringer i tråd med det nye forvaltningsregimet med produksjonsområder. Som vist i dette prosjektet har våre løsninger også svakheter og forbedringsmuligheter, noe våre funn bidrar til å avdekke og konkretisere. De mange ulike bidragene fra prosjektet forventes å ha betydning for utvikling av norsk forvaltning på dette området i årene som kommer, både i form av direkte innspill til endringer i politikkutforming, og indirekte gjennom innspill fra ulike interessenter som bygger på våre funn.

SaRA will investigate the licence system, the Maximum Total Biomass (MTB) as a basic premise for this system, and the current regulatory changes. Such a task requires an understanding of regulatory systems as historically developed, layered and shaped by both political and professional priorities. Assessing the current regulatory system for salmon aquaculture is a comprehensive and interdisciplinary task. SaRA will start by investigating the five licence rounds completed to date, including the recent green licences (WP1), and licences given for special purposes limited to broodstock, exhibition and development licences (WP2). We will study the processes by which these licences were awarded, how pertaining conditions were applied when sites were established, and how these operations are controlled and monitored. We will in particular focus on the current and recent regulatory changes, such as the green licences and development licences. In addition to case studies, we will conduct economic analysis on an aggregate level to investigate the strength and costs of the current system (WP3). We will give an analytical assessment of the functioning of the license system and the use of MTB as a central measurement, and follow closely the implementation of the production area system based on 'traffic-lights' (WP4). This work will put us in a position to provide policy advice for future improvements of the system. The strength of SaRA relies on active communication and dialogue with stakeholders both within the industry and government throughout the project period (WP5). SaRAs project members have excellent publication records, and are active in engaging with stakeholders both in Norway and abroad. A wide international network, and strong relations to University of Florida in particular, will ensure that SaRA has an international outreach.