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Whaling Companies play semantics with ownership

Japanese Whaling Companies play semantics with ownership.
By David Head, Anti-whaling Activist. 3 April 2006.
www.stopwhaling.co.nz

It was reported on April 1st and, like a really good Aprils fool joke it fooled many people, that; "Nissui, 50 per cent owner of Nelson-based [New Zealand] Sealord, has announced it will withdraw from its ownership of a Japanese whaling company and intends to stop its canning and sale of whale meat in Japan. Sealord chief executive Doug McKay welcomed the decision and called the announcement a positive step. "

This is not accurate, in fact Nissui , along with the other shareholders in the company "Kyodo Senpaku", has given away its shares. The 24th March press release from Kyodo Senpaku release includes: "the shares of our company will be transferred to several public-interest corporations including the ICR, so that the share ownership will better reflect our activities". The ICR is the Japanese Research Institute that chartered Kyodo Senpaku's Ships and crews to carry out whaling. The ICR then sold the "by-product" of their so called research to help pay costs. It's interesting to note that the ICR was founded in 1987 as a zaidan hojin - a non-profit organisation funded by donations. Start-up costs were met by Kyodo Senpaku (about 1,250 mil. yen; $9.6 mil.), and members of the public (about 50 mil. yen; $385,000), with all donations being tax-deductible.

The Japanese have this culture of saving face, but in the case in point, this changing of the deck chairs on the whaling fleet changes very little in real terms. That is increasing numbers of whales are going to die for commercial purposes under the thin guise of unneeded, unwanted and spurious research. Worse still the Japanese have already targeted protected and endangered species and intend killing 50 Humpback & 50 Fin whales on their next series of whaling trips.

David G Head Marine Environment Project Manager Citizens Environmental Advocacy Centre Inc. Hawke's Bay, New Zealand www.stopwhaling.co.nz

Reference material:

Kyodo Senpaku Kaisha, Ltd.

4-5 Toyomi-cho, Chuo-ku, Tokyo 104-0055 JAPAN

TEL +81-3-5547-1930 / FAX +81-3-5547-1931

Press Release

Kyodo Senpaku Kaisha, Ltd

March 24, 2006

Subject: Changes in the Shareholder Composition

Kyodo Senpaku Kaisha, Ltd. which operates the vessels used by the Institute of Cetacean Research (ICR) to carry out its whale research programs under the authority of the Government of Japan announced today that its shareholder structure is being changed. Five private companies which had been shareholders of Nihon Kyodo Hogei remained shareholders in the same proportion when Nihon Kyodo Hogei became Kyodo Senpaku Kaisha. However, in view of the scientific and public-interest nature of the activities now carried out by our company it has been decided, with the

consent of our shareholders, that the shareholder composition of our company will be changed.

Specifically, the shares of our company will be transferred to several public-interest corporations including the ICR, so that the share ownership will better reflect our activities. Although some time is required to finalize the transfer of the company's shares to the new shareholder organizations,

present shareholders will eventually be completely divested of their ownership.

Under the new regime, we are committed to redouble our efforts so that we can better contribute to the further development of the research and promoting sustainable utilization of whale resources. [ Comment: So what's changed?]

For further information: Makoto ITO

P.R. & Planning Division

Tel: 03-5547-1940

Technically speaking, Kyodo Senpaku is not a whaling company but a charterer of vessels and crews, yet its creation in 1987 was no coincidence for the same year saw the establishment of the ICR. Since then, Kyodo Senpaku has operated with just two clients, the ICR, and the Fisheries Agency which charters vessels for inspection of Japanese fishing fleets (Table 1). Kyodo Senpaku therefore depends, directly or indirectly, on the government for work. It is important to note, however, that on paper at least, the government has no control over the company either through ownership or the placement of personnel.

With regard to the former, Kyodo Senpaku is 100% privately owned. The major shareholders are the three companies formerly engaged in pelagic whaling, Nissui, Taiyo and Kyokuyo, each with 32%. The remaining 4% are held by three former coastal whaling companies, Del Mar (formerly Nitto Hogei), New Nippo (formerly Nihon Hogei), and Daido

Institute of Cetacean Research

The ICR was founded in 1987 as a zaidan hojin - a non-profit organisation funded by donations. Start-up costs were met by Kyodo Senpaku (about 1,250 mil. yen; $9.6 mil.), and members of the public (about 50 mil. yen; $385,000), with all donations being tax-deductible. In addition a fund was set up into which the Fisheries Agency paid the sum of 346.2 million yen ($2.7 mil.) for the remainder of FY 1987. Since then, incomes have derived from three sources: an annual allocation from the Fisheries Agency of some 500 million yen (Table 2), non-deductible donations from small companies and private individuals (but not from Kyodo Senpaku), and the proceeds from the sale of by-products (or "products") of the research.

A survey of the commercial trade in whale meat products in Japan, June 2000 {Authors: Traffic}

There are currently five legal sources of supply for whale products (including whales, dolphins and porpoises) in Japan: scientific (research) whaling, small-type coastal whaling, drive and hand harpoon fisheries, incidental take and strandings, and long-time stocks.

Japanese scientific whaling has been supplying around 1 000- 2 000 tonnes of whale products from captured minke whales Balaenoptera acutorostrata and Balaenoptera bonaerensis annually as a "by-product" which, in fact, subsidizes in part the scientific whaling operation. This is currently the main source where new whale products from species covered by the IWC moratorium could be added to the commercial market in Japan (another possible source is those whales taken incidentally, such as entangled in trap nets, or stranded).

Small-type coastal whaling supplies over 300 tonnes of whale meat from Baird's Beaked Whales Berardius bairdii, Risso's Dolphins Grampus griseus and Short-finned Pilot Whales Globicephala macrorhynchus each year. Drive fisheries (mainly in Wakayama Prefecture) and hand harpoon fisheries (mainly in Iwate Prefecture) together supply around 700~1000 tonnes of product each year from species including Dall's Porpoises Phocoenoides dalli, Striped Dolphins Stenella coeruleoalba, Spotted Dolphins Stenella attenuata, Bottlenose Dolphins Tursiops truncatus, Risso's Dolphins, Short-finned Pilot Whales and False Killer Whales Pseudorca crassidens.

Notifications issued by the JFA recommend that baleen and toothed whales entangled and drowned in trap nets be buried or burned; in principle, JFA allows whale parts and derivatives to be consumed within local communities only in areas of traditional consumption. However, notifications are not legally binding, so that currently it is not illegal to distribute whale products outside of local communities. TRAFFIC surveys (1999) have shown that at least some whale products from this source flow out of the local communities to supply the demand in urban areas such as Tokyo or Osaka.

Legal long-time stocks of species covered under the IWC moratorium date back at least to 1991, when imports from Iceland were halted following Iceland's withdrawal from the IWC. Long-time stocks also could be from domestic sources acquired prior to Japan's enforcement of the IWC moratorium in 1988. The government reported that legally obtained meat from five species of whales protected by the IWC was in storage in Japan (Anon., 1994).

Overall, Japan's frozen stocks of whale products have steadily decreased over the years. At the end of March each year, Japan had 22 157 tonnes of frozen stocks of whale products in 1980, 10 786 tonnes in 1987, 2 042 tonnes in 1992 and 1 121 tonnes in 1997, according to the statistics referred to earlier (Anon., 1976~1997). Judging from annual supply figures and trends in stocks, whale products consumption (including species not covered under the IWC moratorium) appears to have been in the range of 3000~4000 tonnes annually for the four-year period 1995-1998.

The report examines the technical and economic feasibility of long-term storage of whale meat products. It appears that, despite some technical difficulties, whale meat could be stored for more than ten years without damaging its taste or flavour too much. However, deciding objectively how long whale meat could be stored would be an exceptionally difficult task. Research would be time-consuming and no standard universal measures of freshness, taste, or flavour exist.

The economic feasibility of long-term storage was examined using a standard economic framework and was found to be possible. While it is possible that long-term storage of whale meat is economically a rational behaviour, it is also worth noting that the two wholesalers with Fin Whale stocks said that they were holding old stocks for cultural reasons, rather than for profit concerns.

Import of most whale products is specifically regulated under Japan's Decree of Import Trade Control. Import must first be approved by the Ministry of International Trade and Industry (MITI) before standard CITES import procedures begin. Any importation that threatens the conservation efforts carried out by the IWC will be denied (Anon., 1991a). Under current Japanese policy, the government will allow imports only from trade between IWC member countries.

No specific regulations are in place to regulate whale products trade within Japan. However, in cases where smuggling is proven to have taken place, the Customs Law and the Foreign Exchange Control Law of Japan can be enforced to prosecute smugglers. These laws apply even when the products have already crossed national boundaries and have been traded or stored within the country for some time.

In terms of monitoring and regulation of the domestic market, it is technically possible to identify the species by employing DNA analysis techniques, as was done by TRAFFIC in 1997 (Phipps et al, 1998) and by other organizations and agencies (JFA, 1997; Baker et al, 1996, 1996b, 1999). However, previous TRAFFIC reports have highlighted some of the potential problems in effective monitoring of the commercial trade in whale products using DNA analysis in a complex multi-species market such as Japan's (Mills et al, 1997; Phipps et al, 1998). Work done by TRAFFIC in Japan has identified shortcomings in the current domestic management system's ability to distinguish between legal and illegal whale meat in the marketplace as inclusion of samples from frozen stocks and incidental catch in the register is not mandatory. In Japan, a DNA register could provide an effective tool for monitoring whale meat stocks only if samples from all legitimate sources of whale meat were to be included.

TRAFFIC proposes the establishment of a comprehensive DNA register within Japan for whale species covered under the IWC moratorium, encompassing not only "by-products" from scientific whaling, but also imported products, incidental catch and strandings, and frozen stocks. For domestic trade management purposes, DNA profiling for all the imported whale products is desirable. DNA profiles stored in a databank could then be utilized for the monitoring of domestic trade in whale products to determine if products are from a legal source.

Inclusion of frozen old stocks could be achieved by setting a time limit for either selling off existing products or submitting a tissue sample for DNA profiling. Incidental take and strandings should not be overlooked albeit the amount supplied from this source would likely be very small in quantity. Reporting of incidental catch and strandings of baleen whales and Sperm Whales as well as submission of tissue samples should be mandatory and supported through legal penalties for violations. This framework would be a powerful tool in achieving an effective monitoring of trade in whale products. From an overall management perspective, it would be appropriate to support the DNA register by requiring sellers of whale products to label products to indicate the species and geographic origin. Such a label would complement DNA analysis techniques in confirming product status, and make monitoring of trade in whale products far easier to implement in practice.

TRAFFIC recommends that the Government of Japan undertake the following actions for whale species covered under the IWC moratorium:

a.. Institute a mandatory policy for imported whale meat requiring submission of a tissue sample for DNA profiling and inclusion in a DNA register.

b.. Incorporate long-time frozen stocks into the DNA register by setting a time limit for either selling off products or submitting a tissue sample for DNA profiling.

c.. Institute a policy requiring the mandatory reporting of incidental catch and strandings of baleen whales and Sperm Whales as well as submission of a tissue sample for DNA profiling and inclusion in the register.

d.. Support the mandatory system for tissue samples submission through legal penalties for violations.

e.. Institute a mandatory system requiring sellers of whale products to indicate species and geographic origin of products with a label.

f.. Assign responsibility for market sampling and maintenance of the DNA register to an independent third party.

ENDS

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