Victor Billot is the Communications Officer for the Maritime Union of New Zealand (MUNZ). This is written in his personal capacity. Ed.

"Capital," wrote Karl Marx, "comes (into the world) dripping from head to foot, from every pore, with blood and dirt" (“Capital”, Volume 1, Chapter 31). In the case of New Zealand's fishing industry and its failed 21st Century experiment with globalisation, that observation might be amended to "dripping with blood and salty water". After years of shameful inaction, it appears the tide is going out on the deregulated, free market ideology that has encouraged the use of foreign vessels and exploited foreign crews in the New Zealand fishing industry.

What went on a few miles over the horizon was of little concern – as long as the profits kept flowing into the coffers of some of New Zealand's biggest fishing corporates, including major iwi enterprises. These companies engaged in joint ventures that saw them exploit quota under the New Zealand fishing regime by bringing in foreign charter vessels (FCVs) with overseas crews. The deaths, injuries, sinkings, violence, abuse, stand over tactics, theft of wages, and shocking conditions on these vessels over many years have all been documented – and now exposed on the international stage.

Since the beginning of 2012, fast moving developments have shaken the industry to its core. Following the conclusion of an official inquiry into the industry in March 2012, in a surprise move the New Zealand government announced in May that a ban on foreign flagged fishing vessels in New Zealand waters would be phased in over the next few years. But in a classic case of too little, too late, the damage had already been done. As fast as the hapless politicians pumped, the bilge kept rising around them.

A top level US State Department report released in June 2012 has condemned New Zealand industry practices and compared some activities as akin to slavery. This unpalatable truth came hot on the heels of the publication in the US business press of an investigative report into use of FCVs, which has resulted in major US retailers launching probes into their New Zealand-sourced fish products and threatening severe repercussions. Whatever way you look at it, whether your concern is the basic rights of working people, or the public image of New Zealand in our overseas markets, it has been a grim episode in New Zealand's recent history – at times farcical, and at times tragic.

The big news on 22 May 2012 was the Government announcing it will require reflagging of foreign-owned fishing vessels operating in New Zealand waters "to address labour, safety and fisheries practice concerns". Foreign charter vessels (FCVs) were out. Or at least, they would be forced to comply fully with New Zealand laws and regulations, at least in theory, by having to reflag under the New Zealand flag. The change of tack by Primary Industries Minister David Carter and Labour Minister Kate Wilkinson took many by surprise.

An official inquiry into the industry headed by former Labour Government Minister Paul Swain reported back to the Government early in 2012. Their report was made public on 1 March 2012 and made 15 recommendations for the Government to consider in tightening up the industry. (see http://www.fish.govt.nz/en-nz/Consultations/Ministerial+Inquiry+into+Foreign+Charter+Vessels/default.htm).

The recommendations were based mainly around beefing up the regulations and response of Government agencies such as the Department of Labour, MAF/Fish (the merged Ministries of Agriculture and Forestry and Ministry of Fisheries) and Maritime New Zealand. On the labour issue, the report favoured requiring the New Zealand charter partners having to obtain vessels on a "demise charter". The practical effect of this would be the crews would have to be employed by the New Zealand operators on New Zealand employment agreements, as opposed to the current situation where FCV crews are generally employed by overseas labour agencies in their country of origin.

David Carter claimed at the time of the inquiry going public that: "The issues are not widespread in the New Zealand commercial fishing industry, but they are serious where they occur and need to be addressed in a coordinated manner, backed by legislative change". However, several months later, Carter and Wilkinson ramped up their response by declaring FCVs would be out of the industry – with a few conditions attached, of course. This move went well beyond any recommendations of the Swain report, and the initial response of the Government. In fact, the Inquiry report had specifically stated that it did not recommend reflagging FCVs to New Zealand, instead favouring the "demise charter" approach. Something must have happened in the meantime. Perhaps the growing exposure of the problem in overseas markets and to consumers around the world through damning, high profile media coverage had started to recalibrate the faulty moral compass of our political leaders? (see http://www.itfglobal.org/fish/).

The One That Got Away: The Industry Responds

Despite the tacit acknowledgement that the FCV situation had turned into a fiasco, the Government offered a four year transition period to soften the blow to the joint venture operators, who comprise 12 out of 27 of the fishing industry companies. The offer was criticised by industry figures, lawyers, political opposition and the Maritime Union as overly generous to the responsible parties. While many FCV operators seemed resigned to the inevitable, there was a certain amount of whinging.

Ngati Porou Fisheries General Manager Mark Ngata complained in the Gisborne Herald (22/5/12) that the new law was "not realistic...The whole reason foreign charters were brought into New Zealand waters in the first place was because New Zealand operators didn’t want to catch the high-volume, low-value species foreign charters do," says Mr Ngata, who added: "New Zealand simply did not have the workforce at present" to catch its own fish (although it may be noted that New Zealand does, of course, have a very high number of young people with no jobs, Gisborne being one area badly affected).

Mr Ngata's sentiments notwithstanding, iwi are quickly coming to terms with the new arrangement. On 7 June, Radio New Zealand reported North island iwi were talking about buying and operating their own fishing vessel. The Iwi Collective Partnership (ICP) made up of 12 North Island iwi (including Ngati Porou) currently pool their quota and lease it to Sanford, which operates four FCVs. ICP Manager Maru Samuels said that his organisation must “focus on creating an interest in fishing careers by developing training and scholarship programmes within the seafood industry”.

The New Zealand Council of Trade Unions Vice President Maori, Syd Keepa, earlier told Radio New Zealand (23/5/12) the new regulations will benefit Maori and iwi needed to start planning now. Because chartering foreign vessels will now be more expensive, iwi may hire their own crews, and employ Maori who are currently jobless, he said. Once again, New Zealand has been a "world leader" – in opening ourselves up to the worst practices of deregulated global enterprise, with entirely predictable outcomes and wasted years in which the situation was allowed to fester.

Most other countries don't permit the use of foreign flagged vessels in their fishing industry, as even David Carter acknowledged (the exceptions are apparently Namibia and Brazil). The Maritime Union welcomed the move to reflag vessels, but said the four year transition period announced was overly generous. Maritime Union of New Zealand General Secretary Joe Fleetwood says he hoped that no exemptions will be given at the end of the four year period to any foreign flagged vessels, and that immediate action was still required.

"Given the string of fishery breaches, labour abuses and harm to crew members experienced in recent years, we must ensure that the industry is policed over the transition period". The union also criticised plans to contract out the fishing observers for fishing vessels. “We need more supervision and enforcement on the ships fishing our waters, not less. Outsourcing this role may lead to observers being paid by the industry on a ‘go on, stay on’ basis like the foreign crews are. It won’t work – contracted out observers will simply become like many of the other workers out there on the ships – bullied and not able to do their job properly”.

The Maritime Union through its affiliation to the International Transport Workers Federation (ITF) has assisted many foreign crew members in distress; who have been victims of unethical and sometimes illegal practices. The London-based Secretary of the ITF fisheries section, Jon Whitlow, described the reflagging move as "welcome, right and overdue. Scandal has followed scandal in this area in recent years, including grave instances of crew abuse" (the ITF is engaged in a global campaign to end abuses in the fishing industry – see http://www.itfglobal.org/fish/).

However, it seems that for the Government, each announcement it makes to show it has the situation in hand is overshadowed by a tidal wave of bad publicity. The release of the Swain inquiry in March 2012 managed to coincide with the major US magazine Bloomberg Businessweek running an indepth expose of the entire New Zealand FCV industry entitled "Fishing as Slaves on the High Seas". US journalist E Ben Skinner reviewed the whole operation – starting from the crew members, and the labour hire agencies, and moving back through the New Zealand joint venture operators and bureaucrats.

He went all the way up the supply chain to US retailers who purchased the final product – and who were naturally horrified that they might be implicated in some consumer backlash Skinner tracked down crew member Yusril from the FCV Melilla 203 at his home village in Indonesia. Melilla 203 was a frequent visitor to New Zealand ports and I'd seen it myself alongside the wharf in Dunedin.

Together with its sister vessel Melilla 201, it had been identified publicly by the Maritime Union in the media as far back as 2005 after ship jumping and complaints about the treatment of crew. The majority of the crew, including Yusril, walked off the vessel in Lyttelton in 2011 after ongoing problems aboard including harassment and abuse. When they returned home, according to Skinner, their Indonesian manning agency coerced most of the group into signing documents "waiving their claims to redress for human rights violations, in exchange for their originally stipulated payments of between $US500 to $US1,000".

Skinner followed up with the Indonesian manning agency, which got a security guard to take him off the premises. Sadly, Yusril, the crew member who had gone public in the interview, and who had resisted signing away his rights, was later forced to go into hiding, in a blatant example of the kind of stand over tactics experienced by crews. Michael Field of the Sunday Star Times (SST, 26/2/12) wrote that Ben Skinner, back in Boston, received a text message from Yusril: "strangers at my house, leaving with my family, very scared, please help". Yusril was taken with his family to a safe house with the help of the US Embassy, where his host told Field in a Skype interview the "strangers" were agents of FCV labour hire company PT Indah Megah Sari (IMS). The agents had demanded Yusril withdraw the statements he had made to Skinner.

However, everything was sweet, according to New Zealand business leaders. Fishery executives that Skinner spoke to in New Zealand, like Sanford Chief Executive Officer (CEO) Eric Barratt or United Fisheries’ Andrew Kotzikas dismissed crew problems as minor, non-existent or always due to someone else – despite their FCVs being identified by Skinner as problem cases. Kotzikas cynically described New Zealand labour laws as "beautiful stuff" that didn’t have much relevance with what went on offshore.

However this dismissive approach did not wash with the corporate customers of the fishing operators. The largest importer of New Zealand fish into the United States, Mazzetta Corp, wasn't quite so casual, and sent a shot across the bows of its old friends in Kiwiland after finding out it was being implicated. "Leadership requires taking responsibility, and in light of this information changes must be made for Mazzetta Company to continue its relationship with Sanford," CEO Tom Mazzetta said.

The Sunday Star Times reported in its 26 February "whistle blower" story that Mazzetta was a $US510 million Chicago operation that had pioneered orange roughy fishing with Sanford. Mazzetta had told Sanford's Board "to say that I am extremely disappointed would be an understatement". What has to be remembered here of course is the highly placed connections of New Zealand's big fishing players – the Sanford Board includes Chairman Jeff Todd and Board member and National Party President Peter Goodfellow.

"[Allegations] of this nature are simply unacceptable and warrant revision of Sanford's oversight to continue in our existing relationship," Mazetta said. Sanford said there were no labour issues and it had observers on FCVs and would be "in on-going discussions" with Mazzetta, according to the SST report. In turn, the US corporates are facing pressure on their own territory. The USA imports an estimated $US14.7 billion worth of fish annually and "regulators are beginning to pay attention to the conditions under which that food is caught," says Skinner.

A new law in California introduced at the start of 2012 requires that retailers with over $US100 million in global sales publicly disclose their efforts to monitor and combat slavery in their supply chains. The law covers some 3,200 corporations that do business in the state, including several that trade in seafood. Contact by Skinner with various US retailers and producers had started alarm bells ringing. New Zealand FCV operator Sanford is also a supplier to US firm High Liner, which in turn supplies to major retailers such as Safeway and Walmart.

High Liner CEO Henry Demone told Skinner that he “abhorred” slavery and labour abuse, and that his company “tries very hard to do the right thing… In the case you’re talking about, we bought from a company whose labour practices in the [processing] plant were fine. We audited that. We didn’t audit the fishing vessels. But we relied upon a well-known New Zealand-based company and their assurance of 100% observer coverage". Spokespeople for Safeway and Walmart pledged swift investigations, after being alerted to the issue by Skinner.

“As with all of our suppliers, we have a process underway to obtain documentation that [High Liner is] complying with the laws regarding human trafficking and slavery, and that [they are] reviewing their supply chain to insure compliance,” said Brian Dowling, Safeway’s Vice President of Public Affairs, on February 17. “We have not yet received certification from High Liner. However, we are following up with them immediately and asking that they provide us with certification”.

The Bloomberg Businessweek report was bad enough for New Zealand, detailing an unforgiving picture of New Zealand's complicity in serious abuses of basic human rights, and angry and concerned customers in our largest export markets.  But worse was to come. In the latest embarrassment, the US State Department criticised New Zealand for being a destination country for forced labour in its 2012 Annual Report on Human Trafficking (one of the authors of the report, Ambassador at Large Luis cdeBaca, had visited New Zealand in 2011, where he met with Maritime Union officials, amongst others, to specifically look into fishing industry labour issues).

The high profile Report, which looks at all nations, was released 20 June 2012 in Washington, DC, by Secretary of State Hillary Clinton. Alongside with what is described as smaller scale human trafficking in the sex industry, the Report notes: "Foreign men, largely from Indonesia, Cambodia, Vietnam, and Thailand, are subjected to conditions of forced labour, including debt bondage, aboard foreign-flagged fishing vessels in New Zealand waters". The Report notes that "alleged conditions experienced by workers on these boats – most of which are Republic of Korea (South Korea)-flagged – include confiscation of passports, imposition of significant debts, physical violence, mental abuse, and excessive hours of work" (there was also reference to “Asian and Pacific Islander” migrants working in agriculture who are "forced to work in conditions different from what was stipulated in their contracts").

The Report also states some foreign workers in New Zealand report being charged excessive – and escalating – recruitment fees, experiencing unjustified salary deductions and restrictions on their movement, having their passports confiscated and contracts altered, or being subjected to a change in working conditions without their permission. According to the US State Department: “These are all indicators of human trafficking" (to make it perfectly clear what they are talking about, human trafficking is "modern day slavery").

The Report says that while New Zealand complies with minimum standards for the elimination of trafficking, the New Zealand government "made no convictions or prosecutions under the country’s trafficking legislation . . . [and] did not formally identify any persons as trafficking victims during the year". A full page graphic in the Report's introduction (page 20), featured an advertisement from the 5 June 2007 edition of the Otago Daily Times (ODT) which it compared to those from United States newspapers at the height of slavery in the 19th Century.

The advertisement offered an $NZ1,000 bounty for information leading to the whereabouts of Kismo Pakistan, an Indonesian fisherman who jumped ship from FV Oyang* 70 while at port in Dunedin. It appears Mr Pakistan, whose whereabouts remains unknown, had good reasons to leave this ship. The Oyang 70 later sank in dubious circumstances 740km off the coast of Dunedin, with the loss of six lives of foreign crew members. The State Department report compared the advertisement with 18th and 19th Century American slave owners who placed similar advertisements in newspapers, offering up to $US200 for the return of runaway slaves. The report said ads such as the one in the ODT showed the practice continued today. *Sajo Oyang Corporation was one of the three equal runners up in the 2011 Roger Award for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. The Judges’ Report can be read online at http://canterbury.cyberplace.co.nz/community/CAFCA/publications/Roger/Roger2011.pdf. Ed.

Maritime Union of New Zealand General Secretary Joe Fleetwood congratulated the hard hitting nature of the Report, saying it vindicated the Union’s stance that the deregulated fishing industry and exploitation of overseas labour was a stain on New Zealand's reputation. Fleetwood says the damage to New Zealand's global reputation was hard to quantify. "The blame must be put at the foot of the cowboy operators in the industry, and successive Governments who soft pedalled the issue and only took belated action when forced to. The lesson being they can't afford to sweep these dirty little secrets under the carpet anymore".

In another sign of the impact of the FCV scandal, a New Zealand arm of the global anti-slavery activist group Stop the Traffik was launched in June 2012, co-ordinated by the Salvation Army. Dr Christina Stringer, who is a Steering Committee member and co-author of a major investigation into labour and human rights abuses on FCVs*, says the US State Department Report was consistent with the research carried out by herself and Glenn Simmons. “It is interesting the Report notes that while prosecutions are underway for environmental offences aboard Korean fishing vessels, to date there have been no convictions or prosecutions under New Zealand’s trafficking legislation” (*“Not in New Zealand waters, surely?”, Christina Stringer and Glenn Simmons, September 2011, http://docs.business.auckland.ac.nz/Doc/11-01-Not-in-New-Zealand-waters-surely-NZAI-Working-Paper-Sept-2011.pdf).

Dr Stringer says the State Department Report highlights that New Zealand lacks a comprehensive anti-trafficking law. Stop the Traffik Aotearoa’s main objectives are described as “highlighting trafficking labour exploitation and abuse in the supply chains of products manufactured overseas and sold in New Zealand, and trafficking and related labour and human rights abuses occurring in New Zealand territory” (see http://www.salvationarmy.org.nz/site/stop-the-traffik/).

One of the great conceits of corporate globalisation is how the international free market delivers the benefits of Western capitalism and liberal democracy to the so-called "developing world". As we have seen in the case of the fishing industry, what actually happens is the reverse process. A developed nation like New Zealand allows global "worst practice" to become established in a key industry. There are no winners of course, except the fly by night operators in the industry, with even the corporates who turn a blind eye to their "subcontractors’" activities putting their business in jeopardy around the world.

It's only when the situation gets so outrageous that it can't be contained, that we seem to start getting worried about the effect on New Zealand's "reputation". Our reputation, after all, is more important than the foreign workers who are exploited and abused, and often maimed or killed on the job, to secure bigger profits. There are two very basic points that need to be made about where the industry goes from here. The first is that New Zealand workers are entitled to decent jobs in a highly profitable New Zealand industry that is based entirely on New Zealand resources. The second is that if overseas crews are to be used, they must be given the full protection of New Zealand law, firstly as a basic principle of human rights and international solidarity, and secondly as a pragmatic strategy to stop them being exploited as a cheap alternate labour force. The new law changes may help with the second point. Whether they will help with the first point is doubtful. The failed experiment in globalised labour in the New Zealand fishing industry is dead in the water for now, it seems. But the driving forces behind this model of globalised capitalism, with its super-exploitation of vulnerable cross-border casualised labour, are becoming stronger and more pronounced.