Government closing loophole for non-cleared fishing vessels

February 3, 2021 20:41

The Russian government has closed the legal loophole which allowed the Russian-flagged foreign-built vessels, never cleared in the customs, to conduct fishery in the Russian EEZ. The decision is supposed to move to RF at least some of the business the boats are generating in foreign harbours. Besides, it should make newbuilding and ship repair in Russia more attractive, reports

Under the current regulations such boats, without entering Russia and not paying the customs duties nor VAT, can fish on the Russian quotas in the EEZ not crossing the 12-mile border.

As regards the requirement to ship catch to the Russian ports from the area within the Barents Sea division line, the non-cleared boats comply through transshipment to reefers bound for Russia.

The new government order No. 2471 dated 31st December 2020 however stipulates that as of 1st January 2022 the boats applying for a fishing permit must be already cleared in the Customs to qualify.

This will mostly affect the North Fisheries (the areas regulated by the Mixed Russian-Norwegian Fisheries Commission) where dozens of such trawlers are operating from foreign ports. 

In the Russian Far East, the situation seems to be less critical and the problem has never been on the agenda of the fishermen’s associations. Presumably, non-cleared vessels are few in RFE. For example, some three years ago NOREBO Group cleared all MRKT supertrawlers based in Busan paying all duties right away.

Some crabbers are also based in China and South Korea as well as MRKT supertrawlers owned by SIGMA Marine Technology LLC. Their custom clearance status is unknown but in any case this is no big issue for the area, sources in the trade told

Apart from revenue, the government is seeking to get more work for the Russian ports, ship repair and shipbuilding yards, cold stores, etc.

Accordingly, this would hit the market for second-hand vessels in favour of building in Russia and potentially the business the Russian non-cleared boats are generating in foreign harbours may partly be transferred to RF.

With this policy in mind, NOREBO Group is already building a modern transshipment hub in Murmansk while Murmansk Fish Port is building a container terminal.

The owners of non-cleared vessels are naturally unhappy about the need to pay the custom duties and the VAT. Acting on their behalf, VARPE (All-Russia Association of Fishery Enterprises, Entrepreneurs and Exporters) has asked the government to extend the transition period to three years. Another proposal suggests that a tax amnesty for the boats should be applied.

However, to change the legislation within the remaining year will hardly be feasible as it is part of the regulations of the Eurasian Economic Union.

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