Tonight's topic is a bit on the short side, bet you are glad of that! By the time you get to the end of the "lesson" you will be grateful. And let me remind you here, that this information is directly from the government, and supposedly put into a language we can all easily understand....mmmmhmmmm. Alrighty then!
What are use caps?
Use caps limit the amount of QS and IFQ a person can hold, to prevent excessive share consolidation or control. The type of use cap that applies differs on the type of person that holds the QS or IFQ. Vessels use caps limit the amount of IFQ that can be fished on a vessel.
How are use caps calculated?
Use caps are calculated by adding up all of the QS or IFQ held by that person and their percentage of direct or indirect ownership in any entity that holds QS or IFQ. This is called the "individual and collective" rule and is similar to the way that we calculate use caps in the halibut and sablefish IFQ program.
As an example, for an individual who holds 100 pounds of IFQ and has a 5 percent interest in a company that holds 100 pounds of IFQ, the amount of IFQ that person would be considered to hold for use cap calculation is 100 pounds (his personal holdings) plus 5 pounds (5% of 100 pounds - his ownership interest in that company).
As an example, for an individual who holds 100 pounds of IFQ and has a 5 percent interest in a company that holds 100 pounds of IFQ, the amount of IFQ that person would be considered to hold for use cap calculation is 100 pounds (his personal holdings) plus 5 pounds (5% of 100 pounds - his ownership interest in that company).
However, for a corporation, partnership, or other non-individual entity that holds QS or IFQ and also holds PQS or IPQ, NMFS uses a different calculation method - a 10 percent threshold rule. In this case, the use cap is equal to all of the QS or IFQ held by that person and all of the QS or IFQ held by any entity in which that non-individual has a 10 percent or greater direct or indirect ownership interest. As an example, a corporation that holds 100 pounds of IFQ and has a 15 percent interest in a company that holds 100 pounds of IFQ, would be considered to hold 200 pounds of IFQ for use cap calculation in 100 pounds (the corporations direct holdings) plus 100 pounds (the company's holdings). NMFS modified this calculation method from the proposed rule to better meet Council objectives.
Stay tuned - there will be some most interesting information coming out of the Bering Sea shortly. I won't engage in speculation and am awaiting confirmation.
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Stay tuned - there will be some most interesting information coming out of the Bering Sea shortly. I won't engage in speculation and am awaiting confirmation.
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