Lord Ordinary refuses interim interdict against change to Scottish pelagic fishing licence conditions

About this case:

• Citation:
  [2023] CSOH 2
• Judgment:
  External link
• Court:
  Court of Session Outer House
• Judge:
  Lord Ericht

The Scottish Fisherman’s Organisation Ltd and Shetland Fish Producers Organisation Ltd sought to have the decision reduced on six grounds, including breaches of the ECHR and irrationality in the decision-making process. The change in conditions was due to take effect on 1 January 2023, causing the motion to be heard as a matter of urgency.

The petition was considered by Lord Ericht. Lindsay KC appeared for the petitioners and Mure KC for the respondents.

Enjoyment of possessions

The proposed change to the licence conditions related to the requirement for Scottish vessels to demonstrate a “real economic link” to the United Kingdom in one of three ways relating to quota stocks, employment of UK-based crew, and operating expenditure. Under the proposed change, the economic link condition would only allow for a link to be demonstrated where 55 per cent of quota stocks for pelagic species were landed into UK ports, with the other two requirements removed as options.

A dispute arose between the parties as to potential losses which would be caused by the change in conditions. The petitioners’ position was that the change would result in loss of profits, as pelagic fish landed and processed in Norway were a premium product that attracted higher prices, with a gap of £200 per tonne for mackerel and £70 for herring. The higher landing requirement would therefore amount to annual reductions in income for many vessels, including amounts in excess of £1.5 million for some vessels.

Counsel for the petitioners submitted that a sea fishing licence was a possession for the purposes of Article 1 Protocol 1 of the ECHR, and the respondents’ decision interfered with their right to enjoyment of that possession. The interference was made following an unfair and improper consultation process and did not strike a fair balance between the petitioners’ interests and any wider public interest justification.

In support of an interim interdict it was submitted that the balance of convenience favoured the petitioners as the decision would have a significant and immediate prejudicial effect on their members’ businesses. There was no strong public interest which required the change to take effect from 1 January 2023. For the respondents, it was submitted that the petitioners’ members had recently enjoyed super-normal profits that could sustain them through 2023, and if the licensing change was not implemented in January, it would not be able to be implemented until 2024.

Uncertainty at this stage

In his decision on the interim interdict motion, Lord Ericht observed: “In my opinion, the petitioners have set out a prima facie case. Even where licensing is a proper exercise of power to control an activity, it is still necessary to consider the impact on the particular claimant. The court will require to consider whether the economic link licence strikes a fair balance between the economic interests of the petitioners (or their members) and the general interests of Scottish society. These are complex issues which will require a full substantive hearing.”

On whether the balance of convenience favoured the petitioners, he said: “January is a crucial month for the harvest of mackerel and so the decision on balance of convenience takes on an element of urgency which would not be so significant if that harvest was evenly spread throughout the year. The court finds itself in a difficult position in attempting to assess whether and to what extent the introduction of the new policy will be prejudicial to the petitioners or their members as the parties are so far apart on crucial matters of fact.”

He went on to say: “It is not possible to resolve these factual disputes without evidence, which is not available at this early stage in the proceedings. Given the uncertainty at this stage about whether there will be prejudice to the petitioners or their members, little weight can be put on such prejudice in assessing the balance of convenience.”

Lord Ericht concluded: “The respondents have confirmed that any loss to the petitioners or the individual pelagic vessels as a result of the licensing change proceeding on 1 January 2023 may be recovered as damages from the respondents in the event that the change is found unlawful by the court. That factor weighs heavily in favour of the respondents in the balance of convenience. It is also of significance that the interim interdict would affect the businesses of third parties, such as processors and demersal and shellfish fishers, and indeed pelagic fishers who are not members of the petitioners, all of whom will have organised their affairs on the basis that the change is going ahead on 1 January.”

The petitioners’ motion for interim interdict was therefore refused.