Kermadec Ocean Sanctuary Bill

Kermadec Ocean Sanctuary Bill

Government Bill

120—2

As reported from the Local Government and Environment Committee

Commentary

Recommendation

The Local Government and Environment Committee has examined the Kermadec Ocean Sanctuary Bill and recommends by majority that it be passed with the amendments shown.

Introduction

The Kermadec Ocean Sanctuary Bill is an omnibus bill as it proposes legislative amendments on an interrelated topic that would implement a single broad policy.

The bill mainly seeks to amend the following Acts:

  • Biosecurity Act 1993

  • Conservation Act 1987

  • Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012

  • Environmental Protection Authority Act 2011

  • Fisheries Act 1996.

If the bill proceeds, it would be split into two bills at the Committee of the whole House stage. Parts 1 and 2, and Schedules 1 and 2, would be debated as the Kermadec Ocean Sanctuary Bill. Upon enactment, this legislation would be listed in Schedule 1 of the Conservation Act 1987.

Part 3 and Schedule 3 would be debated as the Kermadec Ocean Sanctuary (Related Amendments) Bill.

Purpose of the bill

The purpose of the bill is to establish a new 620,000 square kilometre fully-protected marine sanctuary. The sanctuary would be located around the Kermadec Islands above the North Island of New Zealand and would cover approximately 15 percent of New Zealand’s exclusive economic zone. This area is home to a wide variety of marine species.

The New Zealand Government has jurisdiction under Article 56 of the United Nations Convention on the Law of the Sea (UNCLOS) to, among other things, protect and preserve the marine environment within New Zealand’s exclusive economic zone. Article 192 also imposes a general obligation on States to protect and preserve the marine environment.

Fishing, mining-related activities, the disturbance or removal of living or non-living material, the dumping of waste or other matter, and actions that cause damaging vibrations, would be prohibited in the sanctuary. These prohibitions would be enforced under the existing Fisheries Act and Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act offence regimes.

Under the Fisheries Act and Articles 61 and 62 of UNCLOS, no other State could allege a right to access the fisheries resources within the proposed sanctuary without New Zealand having expressed a surplus allowable catch within the area. Permission would also need to be granted by the responsible Minister.

The bill would permit the passage of ships and planes, marine scientific research, and some other activities such as the laying of submarine cables and pipelines.

Research that would otherwise breach one of the sanctuary’s prohibitions would need to be approved by the Environmental Protection Authority (EPA).

A new conservation board would be established to develop a conservation management strategy for the sanctuary, as well as for the Kermadec Islands and the Kermadec marine reserve. The board would be made up of seven members appointed by the responsible Minister. Two of these would be appointed on the nomination of Ngāti Kuri and Te Aupouri (iwi with mana whenua over the Kermadec region, as statutorily recognised in their deeds of settlement), and another would be appointed on the nomination of the Minister responsible for Māori Development.

The Department of Conservation would administer and manage the sanctuary.

Suggested amendments to the bill

This commentary covers the main amendments that we recommend to the bill. It does not cover technical amendments.

Name of the sanctuary

We recommend changing the name of the sanctuary to the “Kermadec/Rangitāhua Ocean Sanctuary”, to recognise the indigenous name for Raoul Island (Rangitāhua) and the surrounding area. Our suggested name change would broadly align with the dual naming convention used in the New Zealand Geographic Board’s 2012 publication, Standard for Crown Protected Area Names.

Consequently, we recommend amending the title of the bill in clause 1, and all references to the name of the sanctuary within the bill.

Definitions

We recommend several amendments to the Interpretation clause (clause 4).

We recommend inserting a definition of “environment”, to clarify that the term would have the same meaning as in the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act.

We recommend inserting a definition of “impact assessment”, to clarify the information that the EPA must obtain when considering an application for authorisation to undertake an activity for the purposes of marine scientific research.

We recommend amending paragraph (c) in the definition of “marine scientific research”. This amendment would clarify that any research undertaken within the sanctuary for mining purposes outside the sanctuary must only be for the purpose of obtaining or complying with relevant consents and authorisations required under other legislation.

We recommend a minor amendment to the definition of “mining activity” so that paragraph (b) mirrors paragraph (c) by referencing subsoil.

To be clear, and to align with section 2(1) of the Maritime Transport Act 1994, we recommend inserting a definition of “warship”.

Status of examples

We recommend inserting new clause 7A, which is a standard provision noting that the examples within this legislation are intended to be illustrative only, and do not cover all possible scenarios.

Activities prohibited in the sanctuary

We recommend amending clause 9(2)(c) to also prohibit the disturbance or removal of living natural material from the seabed or subsoil.

We recommend inserting new clause 9(2)(f) to make it clear that, in addition to other vibrations, all forms of seismic surveying would be considered a prohibited activity.

Activities not prohibited in the sanctuary

We recommend amending clause 10(1)(b) to specify that an activity undertaken for the purposes of marine scientific research would not be prohibited if it is a marine scientific research activity undertaken in accordance with any terms and conditions imposed by the EPA as a result of granting, changing, or reviewing an authorisation.

We recommend inserting new clause 10(2)(aa) to make it clear that activities undertaken under the Biosecurity Act to eradicate unwanted organisms from the sanctuary would not be in breach of clause 9. This amendment would require a consequential amendment to clause 29, section 7B of the Biosecurity Act.

We recommend deleting clause 10(2)(a)(iii) as this would be covered by proposed new clause 9(2)(f).

Relationship with other legal requirements

We recommend amending clause 12(3) so that a person authorised to do marine scientific research would not also have to apply for a special fishing permit under the Fisheries Act. We consider that this amendment would remove an unnecessary administrative burden which provides no additional oversight. Consequentially, we recommend amending the example in clause 12 to reflect this change.

Authorisations granted by the EPA

We recommend inserting new clause 12A to clarify the purpose of the provisions relating to authorisations for marine scientific research, and therefore what the EPA must consider when granting, changing, reviewing, or revoking marine scientific research authorisations.

Term of authorisation granted by the EPA

It was suggested that the term of authorisations be extended because it can take time to organise and complete a marine research expedition. We consider an extension to be appropriate and therefore recommend amending clause 20(2) to extend the maximum term of authorisation from 2 to 5 years.

Determinations on applications for authorisation

We recommend amending clause 19 to require the EPA to decline an application if it considers that the activity to be undertaken is not for the purposes of marine scientific research, or would be likely to have significant adverse effects on the environment.

In considering whether an activity could have significant adverse effects on the environment, the EPA would need to have regard to the matters listed under new clause 19(4).

We recommend inserting clause 19(3) to require the EPA to obtain an impact assessment before making a determination, unless it has decided it is reasonably capable of making the determination without an assessment.

As a consequence of these amendments to clause 19, we recommend deleting clause 15(c)(ii), as it would be redundant.

We recommend inserting clause 19A to allow the EPA to impose terms and conditions on marine scientific research authorisations that it considers are appropriate. We recommend some consequential amendments to clauses 20 and 22 as a result of this change.

We recommend inserting clause 22A. This new clause would allow the EPA, at any time during the authorisation period, to review the conditions it had imposed on the authorisation. The EPA could only do so for one of the reasons listed in clause 22A(2)—for example, if the authorisation had been based on incorrect or outdated information, or had caused unanticipated effects. Under new clause 22A(3), the EPA would first need to give the holder of the authorisation written notice, and a reasonable opportunity to respond. Clause 22A(4) provides that the review would be a separate process, so the EPA would not have to duplicate the requirements involved in the original authorisation.

We recommend inserting clause 22B to allow the EPA to revoke an authorisation if it considers that it creates significant negative environmental effects that cannot be mitigated. We note that the EPA would need to give written notice, and must have satisfied the conditions listed under new clause 22B(2).

We recommend inserting new clause 22D to provide for an appeals process to the High Court for marine scientific research decisions. Appeals could only be made on points of law.

Requiring the EPA to keep records

We recommend inserting new clause 22C to require the EPA to keep records about its marine scientific research functions under this legislation, and to make these records publicly available once all decisions about an application had been made.

Members of the Kermadec/Rangitāhua Conservation Board

We recommend amending clause 24(2) to specify that the Minister responsible for Māori Development must nominate a person to represent the interests of “iwi Māori” who have cultural, historical, spiritual, and traditional associations with the Kermadec area.

This term is broader than “iwi”, which is used in the bill as introduced. Our amendment would allow for a more representative nomination. We note that the term “iwi Māori” is used in the preamble to the Te Ture Whenua Māori Act 1993, and the reference to “cultural, historical, spiritual, and traditional associations” aligns with similar wording in relevant Treaty settlement legislation.

Consultation before recommending regulations

We recommend inserting new clause 27(2A) to require the Ministers to consult with persons and organisations considered appropriate before recommending that regulations be made for any of the purposes set out under clause 27.

Review of the operation of this legislation

We recommend inserting new clause 27A to require a review to be conducted 25 years after the enactment of this legislation. The review would consider the operation and effectiveness of this legislation with regard to:

  • the extent to which its purpose had been achieved

  • any other specific matters required by the terms of reference.

The review panel would need to work under terms of reference set by the responsible Ministers. The terms of reference would need to:

  • provide flexibility so that the review could be refined

  • allow for iwi participation in setting the scope of the review

  • allow for interested persons and the public to be given a reasonable opportunity to make submissions on the matters being reviewed. The review panel would need to consider any submissions received before preparing a report on the review

  • set out the process for the review.

The panel’s report on the review would be provided to the Minister responsible for the administration of this legislation and the Minister for the Environment. The report would then need to be presented to the House of Representatives.

We recommend inserting new clause 27B, which sets out how the review panel would be jointly appointed by the Minister of Conservation and the Minister for the Environment. The panel’s membership would include:

  • 1 member appointed on the nomination of the Kermadec/Rangitāhua Conservation Board

  • 1 member appointed on the nomination of Te Ohu Kaimoana Trustee Limited (or any successor body)

  • 1 member appointed by the Ministers after consultation with representatives of te iwi Māori who have cultural, historical, spiritual, and traditional associations with the Kermadec/Rangitāhua area

  • 3 members appointed by the Ministers.

Amendments to other enactments

Crown Minerals Act 1991

We recommend inserting clauses 33A and 33B, which would insert new section 28B in the Crown Minerals Act. These new clauses would ensure that permits are not granted within the sanctuary under the Crown Minerals Act.

Fisheries Act 1996

We recommend inserting new clauses 46A–46E and 48A, and amending clause 47. These amendments to sections 13, 14, 14B, 20, 75, and 264 of the Fisheries Act, and the insertion of new section 113AC of that Act, concern the total allowable catches and levies for quota management stocks in Kermadec Fishery Management Area 10.

Our amendments would ensure that allowable catches and deemed values for stocks are set at zero, and that holders of quota shares for Kermadec Fishery Management Area 10 are no longer required to pay cost recovery levies on that quota. Amended clause 47 clarifies that any fishing activity within the sanctuary would be an offence.

Fisheries Notice 2015

We recommend amending Part 2 of Schedule 3 to include an amendment to the Fisheries (Total Allowable Catch, Total Allowable Commercial Catch, and Deemed Value Rates) Notice 2015. This amendment and its subsequent consequential amendments would set the total allowable catch, total allowable commercial catch, and deemed value rates for fish stocks in the sanctuary at zero.

Effect of no compensation provision on court proceedings

The majority of us recommend inserting new clause 1A in Schedule 1, to clarify how the no compensation provision in clause 1 of Schedule 1 would apply to court proceedings. This new clause specifies that this legislation would not prevent the completion, or initiation, of court proceedings.

Any proceedings determined (at first instance or on appeal) on or after 1 November 2016 (the commencement date for most of this legislation) would need to be determined subject to the provisions in this legislation. This provision would apply despite any amendments to the proceedings.

Fishing rights under no compensation provision

Schedule 1 of the bill provides that no compensation would be payable by the Crown for any loss or damage, or any adverse effect on a right or interest (including to the value of quota or a right to fish) arising from this legislation.

Submitters expressed their concern to us about a potential loss of fishing rights granted under the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992. The Crown and Te Ohu Kaimoana hold quota for 66 species in Quota Management Area 10. This quota can only be caught within the boundaries of Fisheries Management Area 10 (which corresponds to the area of the proposed sanctuary).

We were informed that none of the 66 Quota Management Area 10 stocks are being caught in Fisheries Management Area 10 as they are currently not considered economically viable. Fishing these species is difficult for several reasons including the remote location of the area and lack of infrastructure. We note that the future economic value of fish stock in this area is difficult to assess.

We were informed that the 66 species are not unique to Fisheries Management Area 10 and can be caught elsewhere in New Zealand waters as long as the fisher holds a fishing permit and an annual catch entitlement. However, the specific quota set for Quota Management Area 10 can only be utilised within that area.

We also note that quota for highly migratory species is currently utilised at low levels in Fisheries Management Area 10. However, this type of quota can be caught elsewhere in New Zealand’s Exclusive Economic Zone, primarily in Fisheries Management Area 1.

We were advised that the no compensation provisions, the prohibiting of fishing in Fisheries Management Area 10, and reducing the total allowable catch to zero, would not extinguish any individual fishing quota in Quota Management Area 10. However, some of us sympathise with submitters who have expressed concern about a loss of fishing rights, as the sanctuary would, in effect, prevent the utilisation of quota within the area of the sanctuary.

Some of us also consider that earlier and improved engagement with mana whenua and organisations such as Te Ohu Kaimoana would have been beneficial to this legislative process.

Right to compensation

We note that the Attorney-General reviewed this bill for consistency with the Bill of Rights Act 1990. While the Attorney-General’s report noted that the prohibition on fishing would “impair the right of individuals to take fish in the sanctuary as part of a cultural practice”, ultimately the Attorney-General concluded that the limitation is justifiable under section 5 of the Bill of Rights Act.

The UNCLOS does not consider the topic of compensation around loss of domestic fishing rights. However, we note that the Government has the right to protect the marine environment within New Zealand’s exclusive economic zone without the need for financial compensation. The approach proposed in the bill is consistent with previous Government decisions not to compensate for fishing rights when establishing marine reserves under the Marine Reserves Act 1971.

Therefore, we do not recommend changes to Schedule 1 to provide for compensation as a result of the inability to utilise quota or any other rights or interests. However, we emphasise that this legislation would not extinguish customary rights or interests in the Kermadec area, and it would not prevent or affect court proceedings.

New Zealand Labour Party minority view

The New Zealand Labour Party has campaigned for the creation of the marine sanctuary in the Kermadecs for over four years. We support its creation and thank its other proponents for their advocacy.

However, the select committee has not properly considered the effect of this legislation on the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992. Does the Government owe a duty not to undermine the value and obligations under Treaty settlements? When do Treaty settlement assets become subject to the laws which apply generally? Is it right for this legislation to say no compensation is payable?

We believe it is wrong that the bill undermines the rights arising from the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992, which were meant to be “full and final”, and in particular those fishing rights relating to Fisheries Management Area 10.

We received a submission from Te Ohu Kaimoana who stated that, prior to the public announcement of the Kermadec Ocean Sanctuary, consultation did not occur with them. It appears that the Government did not adequately consider working with Te Ohu Kaimoana (as Treaty partners) to find a workable solution that promoted the sanctuary while protecting Treaty rights.

Legislation enabling a marine sanctuary within the 12-mile territorial limit predates the quota management system, and it is accepted that marine sanctuaries within the territorial limit do not require compensation of quota holders.

The Crown asserts that compensation is not payable in respect of marine reserves in the exclusive economic zone. It asserts that the principle which applies within the territorial waters applies also in the exclusive economic zone. The Crown and some submitters further maintain that New Zealand’s exclusive fishing rights in the exclusive economic zone arise from the United Nations Convention on the Law of the Sea, which includes obligations to preserve the exclusive economic zone. Accordingly, they say that quota management system quota rights were always subject to the Crown’s ability to create marine reserves in the exclusive economic zone as well.

Quota holders do not accept the Crown’s assertion and believe compensation is legally due. It is wrong that the bill predetermines the complaint that compensation is due for losses caused by the sanctuary undermining the rights arising from that settlement.

The effect of setting the total of the allowable catch in Fisheries Management Area 10 at zero is to prevent the activity of fishing and render some related quota management system quota valueless. The Crown asserts that this approach does not extinguish rights conferred by the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992. Pretending that quota is not extinguished while setting the allowable catch at zero is a device which obscures the reality, which is that quota is effectively being taken away. The change is being made without the consent of the Treaty partner.

If the Crown is correct that quota management system rights in the exclusive economic zone under the 1992 settlement were always subject to the right of the Crown to create reserves without compensation, then it does not need to legislate away the ability of quota holders to claim compensation through the courts.

Although the amount of compensation may not be large in the Kermadecs, because the loss is small, the principle is important.

Including a provision for Te Ohu Kaimoana membership on the Kermadec Conservation Board should not prejudice their ability to test this matter before the courts.

We consider that the impact on customary and commercial rights within the sanctuary cannot be considered fully in the scheduled review. We recommend that the review period be amended to occur 10 years after the bill’s commencement. The review should include in its terms of reference the effect of this bill on the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992. Given other impending changes in the marine space, and the potential impact on fisheries activity, a shorter review period would provide a valid timeframe to assess the issues.

With this serious reservation, we support the bill. We will be moving Supplementary Order Papers to remove the clause preventing compensation being claimed, amend the review period, and include a specified provision in the terms of reference to enable the impact of the bill on the 1992 Fisheries Settlement to be assessed.

Green Party of Aotearoa New Zealand minority view

The Green Party supports the Kermadec Ocean Sanctuary Bill. It has long supported and campaigned for more extensive marine protection in the Kermadec region, including through a private member’s bill lodged in the ballot by Green MP, Gareth Hughes. The geological and biodiversity values of the Kermadec region are extraordinary and internationally significant.

The lack of consultation with iwi by the Crown prior to the Government’s announcement on the international stage of the proposed creation of a Kermadec Ocean Sanctuary has been unsatisfactory. It fell well short of expectations under Te Tiriti o Waitangi. This has been reflected in submissions opposing the bill.

The Green Party recognises that non-governmental organisations such as the Pew Foundation, WWF New Zealand, Forest and Bird, and others have engaged in extensive public discussion, including two science symposia, art exhibitions, and discussions with mana whenua about a proposed Kermadec Ocean Sanctuary over the last seven years. This is not a substitute for the Crown consulting with mana whenua and other iwi.

For the future, the Green Party hopes that the Crown will actively involve and consult iwi in the development of new marine protection legislation. It seeks a clear process for establishing marine protected areas in the EEZ which ensures Treaty rights are respected and implemented, and that the Crown consults properly. Having such a process may have avoided some of the issues around the bill’s introduction. The Green Party is disappointed that current Government proposals to change marine protection law rule out establishing such a process for the EEZ.

The select committee has made significant changes to the bill in response to public submissions including submissions by the Trustees of Te Runanga Nui o Te Aupouri and other iwi authorities and Te Ohu Kaimoana. These changes include renaming the sanctuary as the Kermadec/Rangitāhua Ocean Sanctuary; and providing for a review of the Act’s operation and effectiveness within 25 years of it coming into effect and the sanctuary being established (by 1 November 2041).

The 6-member review panel must include a nominee of Te Ohu Kaimoana Trustee Ltd, a member appointed after consultation with iwi Māori who have cultural, historical, spiritual, and traditional associations with the Kermadec/Rangitāhua region, and a nominee of the Kermadec/Rangitāhua Conservation Board. The terms of reference for the review panel must be jointly agreed by the Minister, Te Ohu Kaimoana, iwi Māori associated with the Kermadecs, and the Kermadec/Rangitāhua Conservation Board.

The submission of the Trustees of Te Runanga Nui o Te Aupouri Trust sought greater recognition of the views of Kermadec iwi authorities on applications for marine scientific research. The bill has been amended to require the Environmental Protection Authority (EPA) to have regard to the views of Kermadec/Rangitāhua iwi authorities when it considers these applications, as well as enabling the EPA to impose conditions or decline applications.

The Treaty of Waitangi (Fisheries Claims) Settlement Act 1992 allocated a share of existing and new fishing quota and a 50 percent stake in Sealord to iwi as settlement of Treaty claims in relation to commercial fisheries.

Fisheries Management Area 10 (FMA 10) has similar boundaries to the Kermadec/Rangitāhua Ocean Sanctuary. The bill does not allow fishing within the sanctuary but it does not extinguish quota rights in FMA 10 held by Te Ohu Kaimoana Ltd and others. Nor does it disestablish FMA 10. The review of the Act’s operation could potentially recommend that the law be amended to allow fishing within the sanctuary.

Holding quota gives fishers a right to go fishing, subject to government management controls. It is not a right to fish everywhere all of the time.

The Green Party supports longstanding government policy that policy measures taken to protect the marine environment and promote sustainable management should not be subject to (or prevented by) financial considerations. The payment of compensation would be a significant expansion of the property rights attached to the allocation of fishing quota.

The Fisheries Act 1996 (section 308), for example, expressly provides that the Crown is not liable to compensate persons adversely affected by decisions made for sustainability purposes under that Act.

Since 1992, thirty eight marine reserves have been established under either the Marine Reserves Act 1971 or special legislation. No compensation has been paid by the Crown to fishers for reducing the area in which quota rights can be exercised by creating these reserves.

The bill makes this policy explicit by providing that no compensation is payable on any limitation on the value of quota or a right to fish arising from the bill.

Neither of the Sanctuary-related proceedings by Te Ohu Kaimoana and the New Zealand Fishing Industry Association currently before the High Court seeks compensation. The bill as reported back makes it clear that existing and future court action may proceed, subject to the no compensation provision.

It was not clear from submissions how quota allocated to iwi under the 1992 Fisheries Settlement differ from commercial quota, such that different policy considerations should apply in relation to sustainability measures such as the Kermadec/Rangitāhua Ocean Sanctuary.

Concerns raised by Te Ohu Kaimoana and some iwi authorities that the bill breaches Treaty rights and interferes with quota rights conferred by the Treaty of Waitangi (Fisheries Claims) Settlement Act are complex. Such concerns are most appropriately resolved by the courts or by negotiation between iwi and the Crown, rather than select committee.

Appendix

Committee process

The Kermadec Ocean Sanctuary Bill was referred to the committee on 15 March 2016. The closing date for submissions was 28 April 2016.

We received and considered 82 unique submissions from interested groups and individuals, and a form submission representing 1,084 submitters. We heard oral evidence from 18 submitters.

We received advice from the Ministry for the Environment, the Department of Conservation, the Ministry for Primary Industries, the Ministry of Business, Innovation and Employment, and the Ministry of Foreign Affairs and Trade, as well as the Parliamentary Counsel Office.

Committee membership

Scott Simpson (Chairperson)

Matt Doocey

Sarah Dowie

Paul Foster-Bell

Joanne Hayes

Tutehounuku Korako

Ron Mark

Hon David Parker

Eugenie Sage

James Shaw

Meka Whaitiri