A FRAMEWORK FOR COMMERCIAL LICENSING 89 



cation, and fairly recognizes established interests, I sup- 

 port it on these grounds. 



The following two chapters contain specific recommen- 

 dations for all commercial fisheries governing the transi- 

 tion from the present licensing arrangements to the new 

 framework proposed in this chapter. With a few excep- 

 tions. I will propose that existing licensees be grandfa- 

 thered in for penods long enough for the new system to 

 take full effect. But once a satisfactory' licensing program 

 is in place, the allocation procedures for commercial 

 licences should be designed so that eligibility is open to 

 everyone on the same basis. 



The term of fishing privileges deserves much more 

 attention than it has received. Hitherto, all licences have 

 carried a term of not more than one year. While an 

 annual licence might be adequate when access to a 

 fishery is unrestricted, when it is limited such a short term 

 offers very little security to fishermen and vesselowners 

 unless it is automatically renewable. My review of the 

 history of restrictive licensing during the past decade sug- 

 gests that licensees were indeed encouraged to believe 

 their fishing privileges would be renewed indefinitely, and 

 this has led to awkward problems in reducing licence 

 holdings in overcrowded fisheries. If it is automatically 

 renewable, the term is, in efliect, perpetual, and the 

 Crown has very little room to adjust licence policies and 

 holdings over time as conditions change. 



Furthermore, under any new programs involving mari- 

 culture leases, lessees must be assured of access to the 

 resource for a predictable and sufficiently long period of 

 time to allow them to plan effectively and make needed 

 investments to properly manage the resource. 



Reform of the licensing system should therefore 

 include provisions for definite, longer terms for fishing 

 privileges, as are provided in licences to most other 

 natural resources. A term consistent with normal plan- 

 ning periods for depreciation of investments would 

 improve the security of licensees and also provide pre- 

 dictable times when the govenmient could modify the 

 privileges granted. 



The following set of recommendations on licence allo- 

 cation, term and renewability offers most fishing enter- 

 prises much greater security than they now have under 

 annual licences, provides the government with the flexi- 

 bility it needs to change the number of fishing privileges 

 as conditions change without interfering with legal or 

 implied commitments, and maintains opportunities for 

 new entrants. 



7. Limited-entry licences and quota licences should have 

 teruLS of 10 years. 



8. The terms of mariculture leases should be determined 

 individually for each in recognition of the characteris- 

 tics of the fishen. the amount of any capital invest- 

 ment required for enhancement and the life cycle of 

 the species. 



In allocating licences, the first step is to determine how 

 many should be available. Therefore — 



9. For each limited-entn fisherv. the government should 

 determine and periodic^allv revise the fleet capacity 

 desired in each gear categorv for each licensing area. 

 One-tenth of that capacity by gear categorv should be 

 available for allocation each year. 



10. For quota fisheries, the government should calculate 

 and periodicallv revise the total allowable catch; one- 

 tenth of the total allowable catch should be allocated 

 under new quota licences each year. 



Next. I propose that, except for the initial allocations 

 to established licensees, competitive bidding procedures 

 be adopted to allocate the total capacity for limited-entry 

 fisheries and the total allowable catch for quota fisheries. 



11. To allocate new 10-ycar limitcd-entrv and quota 

 licences for each fisherv in one of the three licx'asing 

 zones or smaller areas where they will apply, the 

 Department should call for bids. 



i) Bids should be in writing and should be delivered 

 in sealed envelopes bv a prescribed date. 



ii) When all bids are in hand at the prescribed date, 

 they should be opened in public and ranked from 

 the highest offer to the lowest for each licence 

 categorv. Working downward from the highest 

 bid. licences should be awarded until all to be 

 allocated that year have been absorbed. The low- 

 est bid accepted bv this uK'thod should determine 

 the amount to be paid by all ".uccessful applicants. 

 Anv ties between competing bids for the last units 

 allocated should be rt>solved bv a draw. 



iii) The terms of the 10-year licences should begin 

 the year following their award. 



12. During the first 10 years (the transitional period 

 described in Chapters 9 and 10). onlv holders of 

 licences that recognize eslablished positions in the 

 fisheries should be eligible to bid for new licences. 

 Thereafter anyone should be eligible. 



13. For new limited-entrv salmon and roe-herring licences 

 the following provisions should be made: 



i) The licence should authorize the licensee to fish 

 for salmon or roe-herring with specified gear, 

 with a vessel of the authorized capacity and, 

 where applicable, in a particular zone. 



