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Thursday, December 31, 2015

December 31, 2015

For Immediate Release

 

Opposition Asks Licensing Board Several Questions to Consider

When Reviewing Royal Greenland’s Application to Purchase Quin-Sea

 

Paul Davis, Leader of the Official Opposition, has written to the Fish Processing Licensing Board to raise several questions the board should consider when reviewing the application by Royal Greenland to purchase Quin Sea Fisheries Limited, which operates fish plants in six Newfoundland and Labrador communities.

 

“While we strongly support foreign investment in Newfoundland and Labrador’s economy, it is prudent for us to explore and understand the implications of an application by a company owned by the Government of Greenland to purchase a fish processing company in our province, and we believe both the board and the government ought to open up this discussion and answer people’s questions so there is clarity before the final decision is made,” said Davis.

 

The letter raises the following questions:

 

  • Are there any existing respective trust agreements and, if so, would those agreements be inherited by Royal Greenland, along with effective control of the respective harvesting quotas?

 

  • What would be the implications of this with respect to the pool of resources that are available to Newfoundland and Labrador-based fish harvesters?

 

  • Considering all the implications, would the approval of this application set a precedent with respect to foreign influence in the Canadian fishery?

 

  • Would the approval of this application controvert the Government of Canada’s longstanding fleet separation policy?

 

  • Does the business plan provided by Royal Greenland as a part of the application process give an indication that local jobs will continue to be sustained at the current levels?

 

  • Would Royal Greenland have the freedom under CETA to process locally harvested fish outside the country?

 

Davis said the board has the authority under the Fish Processing Licensing Board Act to “hold an open public meeting with respect to the application in question”. He said, “Considering the implications of this application, an open public discussion of the matter may be advisable in this instance.”

 

-30-

 

Media Contact:

Heather MacLean

Director of Communications

Office of the Official Opposition

(709) 729 6105

heathermaclean@gov.nl.ca

 

Backgrounder

 

Below is the letter to the Board.

 

Attention: Mr. Ted Lewis, Chairperson, Newfoundland and Labrador Fish Processing Licensing Board

Submission on behalf of: The Official Opposition Caucus, Newfoundland and Labrador

In response to: Change of Operator Application to transfer licences from Quin-Sea to Royal Greenland

 

Dear Members of the Fish Processing Licensing Board,

 

The Official Opposition Caucus has several questions about the transference of operator licences from Quin Sea Fisheries Limited (Quin-Sea) to Royal Greenland A/S. We trust that the Board will take these questions into consideration when reviewing the application and making a recommendation to the Minister pursuant to the Fish Processing Licensing Board Act.

 

The Board’s review of this Change of Operator application is an important regulatory step that will help to determine whether Royal Greenland will be permitted to proceed with its plan to purchase a controlling business interest in Quin-Sea. Our questions relate to the overall business transaction and the impact of it.

 

While many details of the business transaction have not been made public and only limited information is available regarding both Quin-Sea and Royal Greenland, the Official Opposition Caucus has some questions regarding this transaction. The Official Opposition asks that the Fish Processing Licensing Board take these questions into account when adjudicating the Change of Operator application.

 

Royal Greenland is a foreign interest, a company wholly owned by the Government of Greenland. We strongly encourage foreign investment in our economy. There is a longstanding policy tradition of insulating the Canadian fishery from foreign control, and allowing this Change of Operator application would give a foreign company greater influence in the Canadian fishery. If that company were to inherit trust agreements with respect to harvesting quotas, that influence would be increased. Quin-Sea may currently have trust agreements with those who hold harvesting licences and, through these agreements, Quin-Sea may exert effective control of the respective harvesting quotas. If such trust agreements are in place and this Change of Operator application is allowed, a non-Canadian company may control Canadian quotas. Are there any existing respective trust agreements and, if so, would those agreements be inherited by Royal Greenland, along with effective control of the respective harvesting quotas? What would be the implications of this with respect to the pool of resources that are available to Newfoundland and Labrador-based fish harvesters? Considering all the implications, would the approval of this application set a precedent with respect to foreign influence in the Canadian fishery? Would the approval of this application controvert the Government of Canada’s longstanding fleet separation policy?

 

Although there has been a public and published commitment by Royal Greenland to keep the processing plants owned by Quin-Sea in our province open, it is not clear whether Royal Greenland has committed to process locally harvested product in Newfoundland and Labrador or to keep the local processing plants open for a set tenure and set capacity, irrespective of market pressures. Jobs created by fish processing plants are important to the rural communities in which they are located, so local employees and residents alike have a great interest in knowing whether such commitments have been made. Does the business plan provided by Royal Greenland as a part of the application process give an indication that local jobs will continue to be sustained at the current levels?

 

The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) negotiations dealt with Minimum Processing Requirements for locally harvested fish. Royal Greenland is based in Greenland, which is a European Union “OCT” (Overseas Countries and Territories). Would Royal Greenland have the freedom under CETA to process locally harvested fish outside the country?

 

It is the request of the Official Opposition Caucus that these questions be given due consideration while the merit of the Change of Operator application is being discussed.

 

We would like to reiterate that we strongly support foreign investment in Newfoundland and Labrador’s economy, and we continue to believe that Newfoundland and Labrador ought to benefit from CETA and its provisions respecting fish processing. However, it is prudent to ensure that we explore and fully appreciate the implications of important changes in ownership and control before those decisions are approved.

 

We note that the Board has the authority, pursuant to paragraph 10.(2)(b) of the Fish Processing Licensing Board Act, to “hold an open public meeting with respect to the application in question”. Considering the implications of this application, an open public discussion of the matter may be advisable in this instance.

 

Sincerely,

Paul Davis, MHA Topsail – Paradise,

Leader, Official Opposition Caucus

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