First steps towards a quota allocation system in the Indian Ocean

In response to recommendations made by a recent performance review, the Indian Ocean Tuna Commission (IOTC) is attempting to develop a quota allocation system (QAS) for management of the tuna and tuna-like species of the Indian Ocean. As “first-movers” in the process, Indonesia, the Seychelles, the European Union, Iran, and the Republic of Korea made contrasting proposals to the IOTC in March 2011 on possible QAS form and structure. Structure (the factors to be taken into account in determining allocation) is critical as it will determine on a long term basis the share accruing to each IOTC member state of the estimated USD 2–3 billion worth of tuna caught in the Indian Ocean each year. This article records and discusses the content of these first steps towards QAS formulation by placing them in the context of rights-based management as applied to the offshore areas falling under tuna RFMO management. The options proposed in March (which the IOTC is still considering) all have a similar architecture but result in sharply divergent allocation outcomes. Despite the sophistication of some of the proposals, the recent IOTC review suggests that the regulatory and management capacity of the IOTC does not match the science and enforcement requirements appropriate to these recent proposals. Perhaps efforts to improve IOTC performance need to be made in parallel with discussions on QAS definition and implementation. To further advance the debate and also concretely demonstrate likely economic outcomes, the article provides indicative monetary valuations of quota allocations proposed. It uses a range of potential historical reference periods (5, 10, 15, and 20 years).

► Proposals have been made for a quota allocation system (QAS) in the Indian Ocean.
► The proposed QAS architecture uses correction factors to determine final quota allocations.
► Modifying correction factors can transfer hundreds of millions of dollars worth of quota between parties.
► An Indian Ocean QAS is unlikely to succeed in the near future given weaknesses in the IOTC framework.