1. WTO rules cover tariffs and non-tariff measures ( NTMs), technical standards, including food safety and quality, rules of origin, anti-dumping measures, subsidies and safeguards, trade in services, intellectual property and dispute settlement.
2. Zonal attachment is a way of defining how the amount of fish to be caught from a shared stock should be divided amongst the coastal states in whose waters the stocks occur. The zonal attachment of a stock is the share of the stock residing within a particular country’s EEZ, weighted by the time it spends in a country’s zone over a year, if necessary.
3. Current EU Member States, less the UK.
4. Relative Stability seeks to guarantee the same proportion of the EU’s quota each year for a Member State, in relation to a species in a fishing area. The Relative Stability key was established based on historical reported landings from 1973-1978, adjusted to take into account the loss of fishing opportunities in third countries’ EEZs and areas dependent on fishing.
5. Where the sharing of TACs for joint stocks is done according to an agreed percentage, based on the spatial distribution of the stock over time and over its various life stages (zonal attachment) for each species.
6. This assumes that the UK inherits the EU’s schedules for the purposes of this project, thus the current EU’s average MFN tariff is applied bilaterally by the UK and the EU.
7. The EU currently has 37 free trade agreements with over 60 countries.
8. The countries included in our simulations vary from specie to specie and are based on the principal trading partner for the UK for that specie. This means that for some of our modelled species, none of the countries which are individually identified are countries with whom the EU has a free trade agreement. In these cases there is no additional change in the bilateral tariffs applied.
9. The assumption of perfect competition means that it does not allow for any monopolistic or imperfectly competitive behaviour by firms. This means markets converge to an equilibrium where no firm is making abnormal profit.
10. The Armington demand structure is a way of setting up and solving the model, and means that within a given industry (in this case, any given fish species) the products (fish) produced by each country are not identical to each other, but are modelled as imperfect substitutes. Hence products are differentiated by their place of origin and a constant elasticity of substitution is assumed among different products in the same class. The degree of substitutability between, for example, the imports of haddock from Canada and from the EU, is a parameter that is then chosen in the model.
11. The GAUSS programming language is used to implement the model.
12. Trade data are available at six-digit Harmonised System ( HS) level. There are codes specific to different species and species groups, but the grouping of species is not consistent across the different categories. For example, while cod ( Gadus morhua, Gadus ogac, Gadus macrocephalus) is distinguished at the HS 6-digit level in 030251 (fresh or chilled) and 030363 (frozen), it is grouped together with seven other families (Bregmacerotidae, Euclichthyidae, Gadidae, Macrouridae, Melanonidae, Merlucciidae, Moridae and Muraenolepididae – including species such as haddock, hake, Alaska pollock) in 030444 (fresh or chilled fillets), but treated separately again for frozen fillets (030471).
13. MFN tariffs are set by each country through WTO agreements which mean that the lowest tariff offered by a country for a product category must be offered to all WTO members. The exception is Free Trade Agreements, where members can lower tariffs to below the MFN level without extending that tariff to all WTO members.
14. Simple averages are usually preferable to weighted averages based on the value of trade. This is because the value of trade is endogenously determined by the tariff itself and so can provide a distortionary picture. Hence in the extreme case where a tariff is very high such that no trade takes place, the weight would be zero, and the weighted average tariff would not even take that product into account even though the tariff is clearly impeding trade.
15. Elasticity of substitution: if the elasticity of substitution were equal to 1 then if the price of say UK fish rose then consumers would switch in equal quantities to suppliers from other destinations. If the elasticity of substitution is more than 1 then there will be a bigger switch to purchasing from other suppliers. Generally, one would expect the elasticity of substitution to be higher than the elasticity of demand. We have assumed an elasticity of substitution of 2.5 and 5. Where the elasticity is equal to 5, the species are assumed to be quite highly substitutable. A supply elasticity of "1" means that if prices rose by 10% supply would increase by 10%. Where the supply elasticity is "3" (as in some of our sensitivity analysis), a 10% increase in price would lead to an increase in supply of 30%.
16. The aim of the sensitivity analysis is to change one of the underlying parameters, such as the supply elasticity, in order to see how sensitive the results are to the change in the parameter. This helps to assess the plausibility and sensitivity of the results.
17. From the FAOSTAT Food Balance: Food Supply – Livestock and Fish Primary Equivalent dataset for 2013 ( http://www.fao.org/fishery/statistics/global-consumption/en).
20. I.e. the quota does not restrict production, as the current level of landings is below the level of the quota.
22. For consistency, the current levels of output, GVA and employment were derived from UK-wide data based on the apportionment methodology described in Appendix I – Wider Economic Impacts Method.
23. Sea fish is defined as all saltwater (marine) species, including whitefish, pelagic fish, flatfish, saltwater shellfish and saltwater exotics. It excludes diadromous and freshwater species (such as salmon and trout).
24. Fish from more than one of the fish type categories which comprise demersal, shellfish, pelagic, saltwater exotics, salmon, trout and other freshwater fish.
25. Information relating to salmon processing is grouped together with other ‘freshwater’ fish in Seafish (2016), hence it is not possible to disaggregate the statistics specifically for salmon. In addition, no turnover or GVA data were available for salmon and freshwater fish processing in Seafish (2016).
28. Where the sharing of TACs or quotas for shared stocks is done according to an agreed percentage, based on the spatial distribution of the stock over time and over its various life stages (zonal attachment).
29. £30 to £60 per shipment.
32. Note that the Zonal Attachment estimate was based on survey data from Area VIa to 300 m depth only. It may therefore under- or overestimate the Zonal Attachment across the whole stock area.
33. In contrast, if the UK’s landings were assumed to increase from current (2015) levels to the full quota allocation under the Zonal Attachment principle (as for the other species), this would have resulted in an increase of 12,052 tonnes. However, landings of this level would have been possible in 2015 under the existing quota allocations, therefore applying this level of production to the scenarios would have over-represented the potential contribution of quota allocation under the Zonal Attachment principle.