Second MSC certification for Gulf of Maine lobster underway

First published in Landings, October, 2014.

In September a group of New England seafood companies made application to the Marine Stewardship Council (MSC) to certify “the Gulf of Maine Lobster Fishery” as a sustainably caught seafood. The application came as a surprise to many because Maine lobster had already achieved MSC certification in 2013 after a seven-year effort orchestrated by three Maine lobster companies, Shucks Maine Lobster, Goat Island Maine Lobster, and Linda Bean’s Perfect Maine.

Gaining a MSC certificate of sustainability is not an easy process. Applicants, called a “client group,” must contract with a neutral, third-party evaluator to assess the fishery against MSC’s three principles of sustainability. That evaluator looks at everything connected to the fishery to ensure that it is sustainable, minimizes environmental impacts and has an effective management plan. hey meet with all the players: fishermen, wharf owners, buyers, dealers, and processors. Eventually the evaluator produces a report which reviews the fishery in detail. If the report shows the fishery to meet MSC principles of sustainability, the Council proclaims the fishery sustainable and gives the client group authority to use its blue MSC logo.

That logo has international value. More and more corporations are eager to meet consumers’ demands for sustainably harvested seafood. Walmart has pledged that it will sell only seafood that bears the MSC label or an equivalent standard at its stores. All fish sold at McDonald’s restaurants in the United Kingdom now bear the MSC label. Sobeys, a large Canadian grocery store chain, has focused on selling only seafood that has been certified as sustainable.

The three companies, operating as the client group called The Fund for Advancement of Sustainable Maine Lobster, obtained the coveted MSC certification in 2013. So why would anyone apply for certification a second time?

As it turns out, the Marine Stewardship Council allows more than one client group to apply for certification for the same species. Generally a second group will apply to the MSC if it cannot come to agreement with the original client group on how to share the first certificate. As Mike DeCesare, Communications Director for the Marine Stewardship Council in the Americas, said in a recent letter published in Seafood.com News, “Whilst MSC strongly encourages participants to share certificates so that others may also benefit, certificate sharing is fundamentally a business transaction. From time to time, businesses do not come to an agreement on ways to share the MSC certificate.”

That inability to reach an agreement with the original client group appears to be at the root of the Maine Certified Sustainable Lobster Association’s formation. The second client group is composed of Cozy Harbor Seafood, Inc.; Craig’s All Natural, LLC; East Coast Seafood, Inc.; Garbo Lobster Co., Inc.; Inland Seafood, Inc.; Mazzetta Company, LLC; and Orion Seafood International, Inc. As Craig Rief, president of the Maine Certified Sustainable Lobster Association, said in a press release, “The association formed a MSC client group that is open, fair, equitable, transparent, affordable and based on mutual respect. We engaged SAI Global as our third-party certifier because they have a solid history of objectively assessing fisheries based on the MSC Principles and Criteria for Sustainable Fishing.”

Is it a question of money? The MSC allows a client group to charge other companies in the same industry a flat fee to join the client group. That fee is based on the cost of the third-party evaluation that led to certification. That process cost the three companies approximately $300,000 in total, said John Hathaway, president of Shucks Maine Lobster. The funds went to “hiring the third party certifier [Intertek Moody Marine of Halifax, Nova Scotia, now Intertek Fisheries Certification], annual audits, legal and accounting fees, research costs, and management/labor costs. The fee structure is based on these costs as regulated by MSC.”

Hathaway said that the fee to join the existing Maine lobster client group is based on the number of live pounds of lobster a company handles. That cost is under $.01 per pound for the first year and less than $.005 per pound thereafter.

Companies joining the original client group after certification must also pay an annual fee. That annual fee covers the cost of additional research to meet certain “conditions” revealed in the third-party evaluation. The Maine lobster fishery has three conditions that it must address before its MSC certification expires in 2018. The first concerns habitat. The MSC requires that any fishery that cannot show it has no impact on habitat must have a plan to ensure it does not pose a threat to habitat. In Maine, that poses a bit of a paradox. Because the assumption is that trap fisheries don’t really affect the seafloor, no research studies have been done. Without a study that shows no impact, the client group must show that lobster traps don’t pose a threat to seafloor habitat. So that means spending money on research.

The two additional MSC conditions have to do with management of Maine lobster. The state must have a management plan in place which incorporates the “precautionary approach” and clearly articulates both short- and long-term goals. Despite the fact that the Maine lobster fishery has in place specific conservation measures (e.g., V-notching, size restrictions, escape vents), no official management plan has been adopted by the state. Currently lobster is managed regionally under the Atlantic States Marine Fisheries Commission. In addition, the Department of Marine Resources committed this year to developing such a plan for lobster, which should address the MSC conditions referring to short- and long-term goals.

In addition to joining the client group, a company that handles lobster and plans to use the MSC logo must also apply for a MSC-approved “chain of custody” certificate. To gain a chain of custody certificate, a company must show that it can trace, control, manage and segregate MSC-certified lobster from non-MSC certified lobster. That means hiring an auditor to verify that the company has systems in place to keep the MSC-certified separate from non-MSC-certified lobster.

This system primarily affects larger companies, not lobstermen or the wharf owners who buy their lobster. “Traceability is simple,” Hathaway noted. “The dealer makes a simple declaration of where it was landed and that it was landed by Maine licensed fishermen which can be easily proven by their weekly Department of Marine Resources reports.”

If a company wants its final product, say a package of frozen lobster tails, to bear the blue MSC logo, a fee must be paid to use the logo. According to the MSC Web site, the annual fee is based on how much of the MSC-labeled product is sold or purchased annually. If a company sells more than $500,000 of MSC-certified product in a year, for example, the annual fee would be $2,000. Then there are royalties. If a firm sells a retail product containing MSC-certified lobster or lists it on a menu, it must pay a royalty to MSC. That royalty is 0.5% of the value of the product. These monies go directly to MSC.

“The small cost of displaying the MSC’s ecolabel on certified products funds ongoing improvements to the MSC’s standards and the promotion of sustainable choices by businesses and consumers, helping to safeguard seafood supplies for this and future generations,” DeCesare stated in Seafood.com News. According to the MSC 2013-2014 annual report, 72% of its annual revenue comes from “charitable activities (logo licensing).”

Having two lobster entities with MSC certification in Maine causes many in the industry to wrinkle their brows in puzzlement. Hathaway shares that feeling. “I think the real issue here is the industry’s marketing message. Two certifications will almost assuredly confuse the marketplace,” Hathaway said. “MSC is a simple way to tell an international market what a great job our fishermen have done and continue to do to keep our fishery sustainable.”