AFMA recently announced the completion of amendments to the ETBF management plan, and the call for applications for statutory fishing rights. These fishing rights, and the effort allocation of effort that accompanying them, will be managed using Spatial Area Factors (SAFs). SAFs are multipliers that translate the actual amount of fishing effort expended, e.g. in thousands of hooks, into the amount of effort units that are taken off an SFR holders allocation. The intent of these SAFs is to allow spatial management of the fishery, by providing incentives for fishing in areas with low SAFs and disincentives in areas with high SAFs. If used effectively, these SAFs may provide a mechanism for reducing many of the management conflicts in the fishery, such as catch of seabirds and turtles, local depletion of target stocks, and under-exploitation of high seas areas. However, in order to effectively apply the SAFs, AFMA will need to be able to determine the motivational effect of the SAF on fishermen's location choices. Moreover, the SAFs will affect the total allowable effort (TAE) that is actually realized in the fishery in a given year, so not only will they affect individual fishers, they will also affect the performance of the fishery as a whole. It will be critical to be able to make some predictions about how the realized TAE will change, based on the structure of the SAFs in order to weigh alterative management options prior to implementing them. Finally, a move from TAEs to TACs and ITQs will substantially affect the structure of the fishery. Although we will not directly address those changes in this proposal, the behavioral models developed in this project would be rapidly adaptable to a TAC/ITQ system, and could form a basis for informing management as to the potential effects.

As stated in the call for proposals, the implementation of individual tradeable quota (ITQ) in Australian fisheries has brought about many demonstrable gains (e.g. increased capacity utilisation and profit). At the same time, there have been some social, economic and environmental consequences associated with the move to tradeable fishing rights that, even if predictable, may have been unintended. For example, ITQ markets have not always operated as envisaged; thin markets (few buyers and sellers), high transactions costs and the de-coupling of the ownership of quota from fishing practice may have undermined the performance of some ITQ systems. Ownership of quota by processors, exporters and others further along the value chain has also distorted the price incentives in some fisheries. In others, non-fisher quota ownership has resulted in a lease-dependent component of the fishery that are not capturing the benefits generated by the ITQ system. Changing quota ownership characteristics also have an impact on the configuration of industry representatives on co-management committees. It is not yet clear what the longer term impact of this is on stewardship and the decision making process and ultimately on management outcomes. As the extension of ITQs in Australia to a greater number of commercial fisheries, and potentially to support inter-sectoral allocations, is contemplated there is a need to learn from experience of ITQs both in Australia and internationally

ITQs globally have come under intense scrutiny in the fisheries management and economics literature. Synthesising and critically analysing learnings from these studies, as well as relevant knowledge from individuals/groups/organisations involved in the administration of, or affected by, existing ITQ systems will help identify key issues and, where possible, reforms that through adaptive management can improve the performance of existing markets and inform the design of new tradable rights markets.