Currently, the Black Sea region is deeply affected by the war in Ukraine. In addition to the human, military and economic implications of a real//aggressive// war between Ukraine, a Black Sea state, and the Russian Federation, another Black Sea state, we note that the fishing industry has suffered greatly. The public opinion has mostly expressed concern that this war will produce a cereal industry crisis (wheat, corn, sunflower) and, consequently, a potential food crisis affecting more than 50 states, according to the United Nations. Indeed, whilst Ukraine and Russia are among the top grain exporters, we must also mention that the fishing industry is at risk, because we have a rather sensitive situation, in which fishing in the Black Sea is almost impossible, especially in the North Black Sea.
We have all seen that one of the naval mines used by the Ukrainians to protect themselves from the Russian invasion and fortify the Black Sea coast in the strategic port of Odessa, was neutralized due to an intervention mission of the Romanian Naval Forces in the Black Sea meant to remove any danger. There are probably other such examples, where Romanian, Bulgarian and other fishing vessels are in danger when they are at sea.
During the war, fishermen and merchant ships are much safer ashore than at sea, especially when we encounter several instances of Moldovan and Panamanian-flagged merchant ships that were hit while sailing in the Black Sea on regular trade routes, at a much bigger distance than 12 nautical miles, as recommended.
Currently, the inability to take fishing trawlers out to sea, but also the rise in fuel prices are the main causes that explain the low economic performance of fishing fleets. During the pandemic, fishermen reacted by reducing the costs and increasing the fuel efficiency of their vessels when possible, by reducing the days spent at sea or by ceasing activity. This time the fishing fleets need even more fuel to avoid dangerous areas (some of these areas being the most profitable when it comes to the Romania-Ukraine maritime border, where there are higher amounts of turbot and sea snail). In order to avoid those areas that are in close proximity to Ukrainian waters (such as Snake Island and the Danube Delta), fishing fleets spend several days at sea, and as a result increase costs considerably, especially since about 50% of the fishing industry’s expenditure is fuel.
In these circumstances, the fishing fleets in the Black Sea, especially those in Romania and Bulgaria, are announcing temporary shutdowns due to the difficulty of maintaining their activity, given the decrease in its profitability and the impossibility of compensating the increase in costs with revenues collected. This situation undermines the market supply, while the demand is maintained, which inevitably leads to significant market disturbances.
As with similar occasions in the past, the European Commission has responded to these crisis situations. For example, during COVID 19, Regulation no. 508/2014 on the European Fisheries and Maritime Fund was modified, likewise during the economic crisis of 2008, European Commission articulated Regulation (EC) no. 744/2008.
Virginijus Sinkevičius, Commissioner for the Environment, Oceans and Fisheries said: “The war in Ukraine is a war against all of us. Our fisheries, aquaculture and processing sectors are hit hard due to high energy, oxygen and raw material prices. This is the second time in the past years after the COVID-19 pandemic, so we are again taking quick action to support them in this turmoil. These emergency crisis measures should not in any way impede our long-term efforts towards structural energy transition of the fishery and aquaculture sectors to achieve the objectives of the European Green Deal.”
This time the European Commission announced the crisis mechanism of the European Maritime, Fisheries and Aquaculture Fund (EMFAF), which will provide immediate support to operators in the fisheries, aquaculture and seafood sectors through financial compensation for their economic losses and additional costs. It will allow Member States to provide financial compensation to operators for loss of income caused by the current market disruption, as well as “storage aid” to producer organizations. This phase complements the Temporary Crisis Framework, which allows Member States to provide support through state aid.
The European Commission, because it did not react immediately to the requests of the fishing industry, came up with a solution and considered that “The EMFAF crisis mechanism is a temporary measure. It shall apply retroactively from 24 February 2022, the date of the beginning of Russia’s aggression against Ukraine, and shall last until the end of 2022. “
Under the EMFAF Regulation, the Commission can activate the crisis support mechanism in case of an exceptional event causing significant market disruption. Is this measure enough, however, to support member states of the European Union, bordering the Black Sea (Romania and Bulgaria)?
The temporary crisis framework complements the broad possibilities for Member States to develop measures in line with existing EU state aid rules. For example, EU state aid rules allow Member States to help companies cope with the lack of liquidity and need of urgent rescue aid. In addition, Article 107 (2) (b) TFEU allows Member States to compensate companies for damages directly caused by an exceptional event, such as those caused by the current crisis, so we have exactly such an exceptional situation where Member States will be able to provide grants of up to EUR 35,000 to companies affected by the crisis active in the agriculture, fisheries and aquaculture sectors.
Last but not least, if we look closely at the European legislation, in the same Regulation on the European Fisheries and Maritime Fund, in Article 33, paragraph (1), we have a very important provision for Romania and Bulgaria in this situation, namely that EMFAF ( with an EU budget of € 6.1 billion for the period 2021-2027) can support measures for temporary closing of the activities and these funds can be granted for up to six months, long enough for the war in Ukraine to end, and the waters of the Black Sea to “calm down.”
In conclusion, most likely the companies in the fishing industry, as well as the Romanian and Bulgarian fishermen will benefit from these compensations, granted that they apply to this crisis fund, which, by the way, is in force until the end of 2022, with the possibility of extension. In addition to these new measures to support fishing European states in the context of the war in Ukraine, it is important to mention the fisheries and aquaculture programs for the period 2023-2027, which are basically subsidies from European funds granted through the European Common Fisheries Policy in a technical manner similar to that of the Common Agricultural Policy.
