Norway’s fisheries and coastal affairs ministry is proposing to lift the ownership cap on salmon farming biomass to 40%.
Currently salmon producers cannot own more than 25% of the sector’s total standing biomass.
Under the new proposal, this would be changed to owning 40% of the sector’s production capacity.
The ministry had said in December that it was “considering” the proposal. It has now gone ahead with it, and sent a draft of the new regulations for consultation. The deadline for submissions is June 20, 2013.
The proposal comes as Marine Harvest is hoping to win over the hearts of Cermaq’s shareholders to create a salmon producer that would control 27% of salmon production in Norway.
The new bill is a “victory” for Marine Harvest, Nordea commented last December. “The company currently holds about 22% of the total number of licences, the proposal implies that they can acquire around 180 licences and still comply with the new rules,” Nordea analyst Kolbjorn Giskeodegard said at the time. These numbers might be higher now that Norway has also announced plans to issue 45 new, “green”, licenses.
In its statement, the ministry stressed that the change comes with clearer requirements for coastal districts.
These would be applied using an echelon system, tightening criteria for companies whose ownership exceeds 15% of the biomass, all the way to 40%. The larger the company’s share of the production capacity is, the more demanding the requirements it will have to follow will be.
As part of these requirements, for instance, a company owning 15-20% of the standing biomass would have to process on average 25% of its fish in a coastal district over five years. This requirement would then be increased progressively as the ownership rate increases, reaching 40% for companies owning 35-40% of the biomass.
Higher ownership would also require higher local investments and recruitment of trainees. Small companies, with a share of less than 15%, will not be affected by the proposals, the ministry said.
There will also be requirements on the spread of the company’s activity. The company will be required to have at least one larger activity center such as its administrative unit, a processing division, a research and development division, and a regional headquarter or office in every region where it operates.
“The government is concerned with diversity in ownership in the aquaculture sector. We need both small and large companies,” said Norway’s fisheries and coastal affairs minister Lisbeth Berg-Hansen.
“The aim of the change is more value adding from the aquaculture sector in coastal Norway. The larger the share of common resources a company is able to use, the more it should contribute back to the coastal districts.”
The proposal is based on the draft that was presented on Dec. 12, said the minister. This is encapsulated in the table below as provided by Swedbank at the time: